<PAGE>
June 30, 2000
Evergreen
Equity Funds
Annual Report
Evergreen Equity Index Fund
Evergreen Special Equity Fund
[LOGO OF EVERGREEN FUNDS] [MUTUAL FUND SERVICE AWARD SEAL]
<PAGE>
Table of Contents
Letter to Shareholders ................................................. 1
Evergreen Equity Index Fund
(Formerly, Select Equity Index Fund)
Fund at a Glance .................................................... 2
Portfolio Manager Commentary ........................................ 3
Evergreen Special Equity Fund
(Formerly, Select Special Equity Fund)
Fund at a Glance .................................................... 5
Portfolio Manager Commentary ........................................ 6
Financial Highlights
Evergreen Equity Index Fund ......................................... 9
Evergreen Special Equity Fund ....................................... 12
Schedule of Investments
Evergreen Equity Index Fund.......................................... 16
Evergreen Special Equity Fund........................................ 32
Combined Notes to Schedules of Investments ............................. 39
Statements of Assets and Liabilities ................................... 40
Statements of Operations ............................................... 41
Statements of Changes in Net Assets .................................... 42
Combined Notes to Financial Statements ................................. 44
Independent Auditors' Report ........................................... 52
Additional Information ................................................. 53
Evergreen Funds
Evergreen Funds is one of the nation's fastest growing investment companies with
approximately $80 billion in assets 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 annual 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
----------------------
August 2000
[PHOTO]
William M. Ennis
[PHOTO]
Dennis Ferro
Dear Evergreen Shareholders,
We are pleased to provide the Evergreen Equity Funds annual report, which covers
the twelve month period ended June 30, 2000.
U.S. Markets Experience Volatility
During the past twelve months, U.S. equity markets experienced significant ups
and downs. Technology, communications and biotechnology stocks reigned supreme
for most of the period only to undergo a volatile environment during the last
three months of the period. While these sectors have experienced sharp
corrections, they remain favored sectors.
The Federal Reserve Board increased interest rates six times during the
twelve-month period resulting in the highest Fed funds rate since May 1995.
Normally, the tightening of the money supply would curtail consumer spending,
however, investors in stocks and equity funds seemed to be ignoring the Federal
Reserve Board's actions to insulate the economy from the threat of inflation.
Despite the recent volatility, the threat of inflation and the Federal Reserve's
response to it, investors remain positive about the U.S. economy and the
long-term potential of the U.S. markets. At Evergreen, we believe the economy is
still fundamentally strong and that the Federal Reserve Board will continue to
act aggressively to contain inflation. We remain cautiously optimistic about
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
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 assist you in choosing the most appropriate for
your portfolio.
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,
CFA Managing Director
Chief Investment Officer
First Capital Group, FUNB
1
<PAGE>
EVERGREEN (formerly
Equity Index Fund Select Equity
Fund at a Glance as of June 30, 2000 Index Fund)
--------------------------------------------------------------------------------
PORTFOLIO PROFILE
--------------------------------------------------------------------------------
Philosophy
Evergreen Equity Index Fund seeks investment results that achieve
price and yield performance similar to the Standard & Poor's 500 Index.
Process
The Fund invests only in stocks represented in the S&P 500 Index. The Fund's
cash position is invested in index futures to minimize tracking errors.
Portfolio turnover is minimal and is the result of index compositional changes.
Benchmark
Standard & Poor's 500 Index (S&P 500)
1Past 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 their original cost. The performance of each class
may vary based on differences in loads, fees and expenses paid by the
shareholders in each class. Performance includes the reinvestment of income
dividends and capital gain distributions.
Historical performance shown for Classes A, B, and C prior to their inception is
based on the performance of (1) the Fund's Class I Shares from 7/27/1998 to the
inception of Classes A, B, and C (2) the Class Y Shares of the Fund's
predecessor, CoreFund Equity Index Fund, from 6/1/1991 through 7/27/1998 and (3)
the Class Y Shares of the Fund's predecessor, Viking Index Fund, from 2/14/1985
through 5/31/1991. These historical returns for Classes A, B, and C have not
been adjusted to reflect the effect of each Class' 12b-1 fees. These fees are
0.25% for Class A and 1.00% for Classes B and C. Neither Class Y nor Class I pay
a 12b-1 fee. If these fees had been reflected, returns would have been lower.
Historical performance shown for Class IS prior to its inception is based on the
performance of (1) the Class A Shares of the Fund's predecessor CoreFund Equity
Index Fund from 10/9/1996 to 7/27/1998 (2) the Class Y Shares of the Fund's
predecessor CoreFund Equity Index Fund from 6/1/1991 to 10/8/1996 and (3) the
Class Y Shares of the Fund's predecessor Viking Index Fund from 2/14/1985
through 5/31/1991. Performance of Class Y for CoreFund Equity Index and Class Y
for Viking Index Fund has not been adjusted to reflect the effect of the 0.25%
12b-1 fee applicable to Class IS. Class Y pays no 12b-1 fee. If these fees had
been reflected, returns would have been lower.
Historical Performance shown for Class I prior to its inception is based on the
performance of the Class Y Shares of the Fund's predecessors, Core Fund Equity
Index Fund from 6/1/1991 through 7/27/1998 and Viking Index Fund from 2/14/1985
through 5/31/1991.
The advisor is waiving a portion of its advisory fee. Had the fee not been
waived, returns would have been lower.
--------------------------------------------------------------------------------
PERFORMANCE AND RETURNS1
--------------------------------------------------------------------------------
Portfolio Inception Date:
2/14/1985
Class I Class IS Class A Class B Class C
Class Inception Date 2/14/1985 10/09/1996 11/04/1998 11/03/1998 4/30/1999
Average Annual Returns*
1 year w/ sales charge n/a n/a 1.70% 0.97% 3.99%
1 year w/o sales charge 7.02% 6.74% 6.76% 5.95% 5.97%
5 years 23.31% 23.15% 22.00% 22.72% 23.02%
10 years 17.09% 17.01% 16.47% 16.89% 16.95%
Maximum Sales Charge 4.75% 5.00% 2.00%
n/a n/a Front CDSC CDSC
End
12-month income
dividends per share 0.57 0.43 0.43 0.10 0.10
12-month capital gain
distributions per share 0.36 0.36 0.36 0.36 0.36
* Adjusted for maximum applicable sales charge.
--------------------------------------------------------------------------------
LONG TERM GROWTH
--------------------------------------------------------------------------------
[GRAPH]
[PLOT POINTS TO COME]
Comparison of a $10,000 investment in Evergreen Equity Index Fund, Class A1
shares, S&P 500 and the Consumer Price Index (CPI).
The S&P 500 is an unmanaged market index and does not include transaction costs
associated with buying and selling securities or any mutual fund expenses.
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.
Foreign investments may contain more risk due to the inherent risks associated
with changing political climates, foreign market instability and foreign
currency fluctuations.
The Fund's investment objective is non-fundamental and may be changed without
the vote of the Fund's shareholders.
Class I and IS are institutional shares only and require a minimum initial
investment of $1,000,000.
All data is as of June 30, 2000 and subject to change.
2
<PAGE>
EVERGREEN
Equity Index Fund
Portfolio Manager Commentary
Portfolio Management
Eric M. Teal has managed the Evergreen Equity Index Fund since December 1998.
Mr. Teal has been a Vice President and quantitative equity analyst at FUNB since
he joined FUNB in September 1993.
[PHOTO]
Eric M. Teal
Performance
For the twelve-month period ended June 30, 2000, the Evergreen Equity Index
Fund, Class A shares, had a total return of 6.76%. Return is before the
deduction of any applicable sales charges. It tracked the return of its
benchmark, the S&P 500, which returned 7.24% for the same period.
Portfolio
Characteristics
---------------
(as of 6/30/2000)
Total Net Assets $897,195,322
Number of Holdings 487
P/E Ratio 34.8x
Beta 1.00
Environment
The U.S. equity market exhibited extreme price volatility as the speculative
excesses that built up in the last quarters of 1999 and early 2000 unwound. That
volatility had a major impact on the S&P 500. In the first six months of 2000,
the S&P 500 had intra-day swings of more than 1% on 95% of its trading days. On
more than 60% of its trading days, those intra-day swings exceeded 2%.
Merger and acquisition activity also had a significant impact on the S&P 500,
and thus on the Fund. Over the past year, 56 new companies were added to the S&P
500; 25 of those occurred in the past six months. These stocks were also added
to the Fund's portfolio. Many of those firms fell within the technology and
telecommunications sectors, such as Yahoo!, Broadcom Corp., VERITAS Software,
and QUALCOMM. The result is that the S&P 500 has shifted to focus on so-called
"New Economy" stocks, a shift mirrored in the Fund's portfolio.
Top 5 Sectors
-------------
(as a percentage of 6/30/2000 net assets)
Information Technology 31.0%
Financials 12.5%
Health Care 11.6%
Consumer Discretionary 10.8%
Industrials 9.1%
3
<PAGE>
EVERGREEN
Equity Index Fund
Portfolio Manager Commentary
Strategy
The Fund seeks to achieve price and yield performance that closely aligns with
the S&P 500. We use a stratified sampling technique to replicate industry
positions versus the benchmark, and minimize the variation in returns between
the Fund and the S&P 500. We have improved trading execution, which has enhanced
the Fund's returns. With the large amount of index additions and deletions over
the past year, we emphasized completing those actions in the most timely and
cost effective manner. Close risk monitoring has also aided performance. The
Fund is fully invested at all times, and we rebalance the Fund daily to ensure
consistency with the S&P 500.
Top 10 Holdings
---------------
(as a percentage of 6/30/2000 net assets)
General Electric Co. 4.1%
Intel Corp. 3.5%
Cisco Systems, Inc. 3.4%
Microsoft Corp. 3.3%
Pfizer, Inc. 2.4%
Exxon Mobil Corp. 2.1%
Wal-Mart Stores, Inc. 2.0%
Oracle Systems Corp. 1.9%
Citigroup, Inc. 1.6%
Nortel Networks, Corp. 1.6%
Outlook
Recent economic data suggest that Gross Domestic Product growth may finally be
cooling. In addition, uncertainty about inflation and interest rates seems to be
tempering. We expect that tighter monetary policy and a less exuberant equity
market will produce a soft landing by 2001. The outlook for equities will be
somewhat contingent on the Federal Reserve Board engineering a soft landing for
the economy. Overall, we expect earnings to remain strong and supportive of
stocks. We believe merger and acquisition activity will continue strong, but may
slow from the torrid pace of the last few years and return to more historical
levels. However, we expect volatility to continue to increase. Despite that, we
remain optimistic on the longer-term outlook for the equity market. The recent
market correction has reduced market speculation and moderated the excessive
valuations prevailing at the end of March, setting the stage for a broader and
more sustainable advance.
We believe the Fund is an attractive opportunity for investors because it is
fully diversified and captures all sectors of the economy.
4
<PAGE>
EVERGREEN
Special Equity Fund (formerly Select Special Equity Fund)
Fund at a Glance as of June 30, 2000
--------------------------------------------------------------------------------
PORTFOLIO PROFILE
--------------------------------------------------------------------------------
Philosophy
Evergreen Special Equity Fund seeks capital growth by investing in companies
with small market capitalizations.
Process
The Fund employs a "bottom-up" approach to investing, selecting stocks that have
passed a rigorous screening process which employs both qualitative and
quantitative analysis. To qualify for investment, a stock must meet high
expectations for return potential based on growth, value and momentum factors.
Benchmark
Russell 2000 Index (Russell 2000)
1Past performance is no guarantee of future results. The investment return and
principal value will fluctuate so that an investors' shares, when redeemed, may
be worth more or less than their 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. Performance includes the reinvestment of
income dividends and capital gain distributions.
Historical performance shown for Classes A, B and C prior to their inception is
based on 1) Class IS from 7/27/1998 to their inception, 2) the performance of
the Class A Shares of the Fund's predecessor fund, CoreFund Special Equity Fund,
from 2/21/1995 through 7/26/1998 and 3) the original class of shares of the
Fund's predecessor fund from 3/15/1994 to 2/20/1995. These historical returns
for Classes B and C have not been adjusted to reflect the effect of each class'
12b-1 fees. These fees are 0.25% for Class A and IS, and 1.00% for Classes B and
C. If these fees had been reflected, returns for Classes B and C would have been
lower.
Historical performance shown for Class I prior to its inception is based on the
performance of the Class Y Shares of the Fund's predecessor fund, CoreFund
Special Equity Fund. Historical performance shown for Class IS prior to its
inception is based on the performance of the Class A Shares of the Fund's
predecessor fund, CoreFund Special Equity Fund, and reflects the same 0.25%
12b-1 fee applicable to Class IS. Class I does not pay a 12b-1 fee.
The advisor is waiving a portion of its advisory fee. Had the fee not been
waived, returns would have been lower.
--------------------------------------------------------------------------------
PERFORMANCE AND RETURNS1
--------------------------------------------------------------------------------
Portfolio Inception Date:
3/15/1994 Class I Class IS Class A Class B Class C
Class Inception Date 3/15/1994 3/15/1994 8/30/1999 8/30/1999 8/30/1999
Average Annual Returns*
1 year w/ sales charge n/a n/a 24.26% 24.88% 27.82%
1 year w/o sales charge 30.89% 30.70% 30.45% 29.79% 29.79%
5 years 27.82% 27.52% 26.24% 27.19% 27.34%
Since Portfolio Inception 22.53% 22.31% 21.33% 22.17% 22.17%
Maximum Sales Charge 4.75% 5.00% 2.00%
n/a n/a Front CDSC CDSC
End
12-month capital gain
distributions per share $2.19 $2.19 $2.19 $2.19 $2.19
* Adjusted for maximum applicable sales charge.
--------------------------------------------------------------------------------
LONG TERM GROWTH
--------------------------------------------------------------------------------
[GRAPH]
[PLOT POINTS TO COME]
Comparison of a $10,000 investment in Evergreen Special Equity Fund, Class A
shares1, versus a similar investment in the Russell 2000 and the Consumer Price
Index (CPI).
The Russell 2000 is an unmanaged market index and does not include transaction
costs associated with buying and selling securities or any mutual fund expenses.
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.
Small capitalization stock investing may offer the potential for greater long-
term results; however, it is also generally associated with greater price
volatility due to the higher risk of failure.
Foreign investments may contain more risk due to the inherent risks associated
with changing political climates, foreign market instability and foreign
currency fluctuations.
The Fund's investment objective is non-fundamental and may be changed without
the vote of the Fund's shareholders.
Class I and IS are institutional shares only and require a minimum initial
investment of $1,000,000.
All data is as of June 30, 2000 and subject to change.
5
<PAGE>
EVERGREEN
Special Equity Fund
Portfolio Manager Commentary
Portfolio Management
Timothy M. Stevenson, CFA, Eric M. Teal and Jay Zelko have co-managed the
Evergreen Special Equity Fund since October 1999. The team chooses companies
which they expect will experience growth in earnings and price.
[PHOTO] [PHOTO]
Timothy M. Stevenson, CFA Eric M. Teal
[PHOTO]
Jay Zelko
Performance
For the twelve-month period ended June 30, 2000, Evergreen Special Equity Fund
Class A Shares returned 31.20%. Return is before the deduction of any applicable
sales charges. The benchmark Russell 2000 Index returned 14.32% for the same
period. Good stock selection within the technology sector throughout the period,
a strong IPO market in the fourth calendar quarter of 1999, and an aggressive
stance in the brokerage services industry contributed greatly to the Fund's
performance.
Portfolio
Characteristics
---------------
(as of 6/30/2000)
Total Net Assets $302,038,147
Number of Holdings 152
P/E Ratio 18.8x
Beta 1.14
Environment
During the last six months of 1999, the fast-growing internet and related
technology industries provided rewarding areas for investment, while value
stocks lagged significantly. The scenario changed in 2000. Small-capitalization
stocks were particularly volatile in the first six months, led by "New Economy"
stocks such as internet and software companies, and other firms that had strong
momentum characteristics at the end of 1999. Even "Old Economy" stocks were not
immune from volatility. However, some sectors rallied in response to strong
earnings growth. Notable among them was the energy sector, which was driven to
new highs by rising oil and gas prices, before succumbing to concerns about a
slowdown in global demand stemming from monetary tightening by the Federal
Reserve Board. Biotechnology stocks were strong performers, as investor optimism
grew over the prospects for human gene mapping.
6
<PAGE>
EVERGREEN
Special Equity Fund
Portfolio Manager Commentary
Top 5 Sectors
-------------
(as a percentage of 6/30/2000 net assets)
Information Technology 27.5%
Consumer Discretionary 14.3%
Financials 12.2%
Industrials 11.5%
Health Care 10.9%
Strategy
Our exposure to internet-related companies and wireless providers aided the
Fund's performance in the last half of 1999. However, as we entered the month of
December and saw buying momentum wane, we began to reduce those positions. We
remained optimistic about the outlook for technology companies, but saw greater
relative attractiveness in other areas. Those moves resulted in an
under-weighting of internet and software stocks and an emphasis on semiconductor
issues, which proved a good decision in light of the pullback from many
technology firms. Still, we had standout performers in the semiconductor sector,
including Elantec Semiconductor and Trimble Navigation.
We remained over-weighted in the industrial and energy sectors throughout the
year which benefited the Fund's performance. Standout holdings included Hanover
Compressor, Mark IV Industries, Stone Energy, and Western Gas Resources. Some of
these issues were subject to profit-taking in June, tempering their gains.
An under-weighting in financial companies in 1999 benefited our results.
However, at the end of the first six months of the period, changing trends led
us to add new names in this sector, including Imperial Bancorp. and Dain
Rauscher Corp. Unfortunately, a slowdown in IPO activity and a broad-based
uncertainty pervading the market caused more aggressive securities brokerage
firms, such as Dain Rauscher, Southwest Securities, and National Discount
Brokers to be unusually volatile.
Within the pharmaceutical industry, we did hold exciting biotechnology firms
such as Transkaryotic. However, as investors focused on companies involved in
gene mapping enterprises, some of our other holdings proved to be laggards,
including Guilford Pharmaceuticals and Supergen.
Finally, one of our good-performing telephone stocks from past quarters,
Nextlink Communications, turned into a poor performer.
We made adjustments to the portfolio due to the pending changes in the
composition of our benchmark, the Russell 2000 Index. The reconfigured index
will contain lower weightings in technology and health care and higher
weightings in financials and consumer cyclicals. Additionally, the median market
cap will decline slightly. While changes in the Russell 2000 do not affect our
underlying stock selection discipline, they do affect our perspective on risk
when we buy new holdings for the portfolio.
Top 10 Holdings
---------------
(as a percentage of 6/30/2000 net assets)
Peregrine Systems, Inc. 1.8%
Hanover Compressor Co. 1.6%
Dain Rauscher Corp. 1.6%
American Capital Strategies, Ltd. 1.6%
Nabors Industries, Inc. 1.5%
Imperial Bancorp 1.4%
Newfield Exploration Co. 1.4%
Mercury Interactive Corp. 1.3%
Michaels Stores, Inc. 1.3%
Circle International Group, Inc. 1.2%
7
<PAGE>
EVERGREEN
Special Equity Fund
Portfolio Manager Commentary
Outlook
We do not expect a significant slowdown in growth in the third quarter of 2000,
and thus do not expect a flight to quality from small-cap stocks to more liquid,
large-cap issues. Therefore, smaller stocks should fare well, given their
improving earnings outlook and the information technology boom.
Within the technology sector, we believe that exceptional earnings growth will
sustain strong price appreciation in the months ahead, despite relatively high
stock valuations. Given the productivity-enhancing benefits of technology
products, many businesses must invest heavily in technology to remain
competitive in the global marketplace. While such investments may not be immune
to macroeconomic conditions, demand for faster and better technology should
remain healthy. Many of the Fund's holdings are positioned to benefit from these
trends.
Opportunities for earnings growth and price appreciation extend beyond the
technology field. Many smaller companies have carved out profitable niches
within their industries that may ultimately translate into higher stock prices.
We believe that merger/acquisition activity will become a more important force
in the market, as larger competitors buy smaller firms to bolster their future
earnings growth. The Fund does not search for acquisition candidates, but
anticipates the stock prices of some holdings ultimately will be beneficiaries
of takeover activity.
8
<PAGE>
EVERGREEN (formerly,
Equity Index Fund Evergreen
Financial Highlights Select
(For a share outstanding throughout each period) Equity Index
Fund)
<TABLE>
<CAPTION>
Year Ended June 30,
------------------------------------------------
1996
2000 1999 (a) 1998 (a) 1997 (a) (a)(b)
<S> <C> <C> <C> <C> <C>
CLASS I SHARES
Net asset value, beginning
of period $ 52.06 $ 46.27 $ 37.39 $ 28.47 $ 23.79
-------- -------- -------- -------- --------
Income from investment
operations
Net investment income 0.56 0.54 0.50 0.51 0.51
Net realized and unrealized
gains on securities and
futures contracts 3.06 8.85 10.12 9.16 5.47
-------- -------- -------- -------- --------
Total from investment
operations 3.62 9.39 10.62 9.67 5.98
-------- -------- -------- -------- --------
Distributions to
shareholders from
Net investment income (0.57) (0.51) (0.50) (0.51) (0.51)
Net realized gains (0.36) (3.09) (1.24) (0.24) (0.79)
-------- -------- -------- -------- --------
Total distributions to
shareholders (0.93) (3.60) (1.74) (0.75) (1.30)
-------- -------- -------- -------- --------
Net asset value, end of
period $ 54.75 $ 52.06 $ 46.27 $ 37.39 $ 28.47
-------- -------- -------- -------- --------
Total return 7.02% 22.03% 29.17% 34.44% 25.69%
Ratios and supplemental data
Net assets, end of period
(thousands) $539,804 $570,864 $315,920 $241,413 $166,350
Ratios to average net assets
Expenses++ 0.30% 0.30% 0.38% 0.37% 0.35%
Net investment income 1.04% 1.19% 1.19% 1.63% 1.94%
Portfolio turnover rate 12% 21% 12% 11% 13%
</TABLE>
<TABLE>
<CAPTION>
Year Ended June 30,
--------------------------------------
1999 1998
2000 (a) (a) 1997 (a)(c)
<S> <C> <C> <C> <C>
CLASS IS SHARES
Net asset value, beginning of period $ 52.04 $ 46.27 $ 37.37 $29.62
------- ------- ------- ------
Income from investment operations
Net investment income 0.41 0.45 0.49 0.32
Net realized and unrealized gains on
securities and futures contracts 3.07 8.81 10.12 8.05
------- ------- ------- ------
Total from investment operations 3.48 9.26 10.61 8.37
------- ------- ------- ------
Distributions to shareholders from
Net investment income (0.43) (0.40) (0.47) (0.38)
Net realized gains (0.36) (3.09) (1.24) (0.24)
------- ------- ------- ------
Total distributions to shareholders (0.79) (3.49) (1.71) (0.62)
------- ------- ------- ------
Net asset value, end of period $ 54.73 $ 52.04 $ 46.27 $37.37
------- ------- ------- ------
Total return 6.74% 21.70% 29.17% 28.58%
Ratios and supplemental data
Net assets, end of period (thousands) $18,708 $38,051 $11,944 $4,507
Ratios to average net assets
Expenses++ 0.55% 0.55% 0.38% 0.37%+
Net investment income 0.79% 0.95% 1.19% 1.51%+
Portfolio turnover rate 12% 21% 12% 11%
</TABLE>
(a) On July 24, 1998, the assets and liabilities of CoreFund Equity Index Fund
("CoreFund") were acquired by Evergreen Select Equity Index Fund ("Equity
Index Fund"). Shareholders of CoreFund, Class A, Class B and Class Y became
owners of that number of shares of Equity Index Fund, Class IS, Class IS
and Class I, respectively, having an aggregate net asset value equal to the
aggregate net asset value of their shares of CoreFund immediately prior to
the close of business on July 24, 1998. CoreFund is the accounting survi-
vor, its basis of accounting for assets and liabilities and its operating
results for the periods prior to July 24, 1998 have been carried forward in
these financial statements.
(b) On April 22, 1996, the Class A shares of CoreFund were redesignated as
Class Y shares of CoreFund.
(c) For the period from October 9, 1996 (commencement of class operations) to
June 30, 1997.
+ Annualized.
++ Ratio of expenses to average net assets includes fee waivers and excludes
expense reductions.
See Combined Notes to Financial Statements.
9
<PAGE>
EVERGREEN (formerly,
Equity Index Fund Evergreen
Financial Highlights Select
(For a share outstanding throughout each period) Equity Index
Fund)
<TABLE>
<CAPTION>
Year Ended June
30,
----------------
1999
2000 (a)
<S> <C> <C>
CLASS A SHARES
Net asset value, beginning of period $ 52.03 $ 45.23
------- -------
Income from investment operations
Net investment income 0.40 0.29
Net realized and unrealized gains on securities and futures
contracts 3.09 9.87
------- -------
Total from investment operations 3.49 10.16
------- -------
Distributions to shareholders from
Net investment income (0.43) (0.27)
Net realized gains (0.36) (3.09)
------- -------
Total distributions to shareholders (0.79) (3.36)
------- -------
Net asset value, end of period $ 54.73 $ 52.03
------- -------
Total return* 6.76% 24.08%
Ratios and supplemental data
Net assets, end of period (thousands) $79,991 $38,203
Ratios to average net assets
Expenses++ 0.55% 0.55%+
Net investment income 0.78% 0.96%+
Portfolio turnover rate 12% 21%
</TABLE>
<TABLE>
<CAPTION>
Year Ended June
30,
------------------
2000 1999 (b)
<S> <C> <C>
CLASS B SHARES
Net asset value, beginning of period $ 52.00 $ 45.26
-------- --------
Income from investment operations
Net investment income 0.03 0.08
Net realized and unrealized gains on securities and
futures contracts 3.05 9.83
-------- --------
Total from investment operations 3.08 9.91
-------- --------
Distributions to shareholders from
Net investment income (0.10) (0.08)
Net realized gains (0.36) (3.09)
-------- --------
Total distributions to shareholders (0.46) (3.17)
-------- --------
Net asset value, end of period $ 54.62 $ 52.00
-------- --------
Total return* 5.95% 23.44%
Ratios and supplemental data
Net assets, end of period (thousands) $203,984 $107,334
Ratios to average net assets
Expenses++ 1.30% 1.31%+
Net investment income 0.03% 0.21%+
Portfolio turnover rate 12% 21%
</TABLE>
(a) For the period from November 4, 1998 (commencement of class operations) to
June 30, 1999.
(b) For the period from November 3, 1998 (commencement of class operations) to
June 30, 1999.
+ Annualized.
++ Ratio of expenses to average net assets includes fee waivers and excludes
expense reductions.
* Excluding applicable sales charges.
See Combined Notes to Financial Statements.
10
<PAGE>
EVERGREEN (formerly,
Equity Index Fund Evergreen
Financial Highlights Select
(For a share outstanding throughout each period) Equity Index
Fund)
<TABLE>
<CAPTION>
Year Ended June 30,
-------------------
2000 1999 (a)
<S> <C> <C>
CLASS C SHARES
Net asset value, beginning of period $ 52.06 $50.95
------- ------
Income from investment operations
Net investment income 0.06 0.02
Net realized and unrealized gains on securities and futures
contracts 3.03 1.11
------- ------
Total from investment operations 3.09 1.13
------- ------
Distributions to shareholders from
Net investment income (0.10) (0.02)
Net realized gains (0.36) 0
------- ------
Total distributions to shareholders (0.46) (0.02)
------- ------
Net asset value, end of period $ 54.69 $52.06
------- ------
Total return* 5.97% 2.22%
Ratios and supplemental data
Net assets, end of period (thousands) $54,707 $3,489
Ratios to average net assets
Expenses++ 1.31% 1.31%+
Net investment income 0.01% 0.27%+
Portfolio turnover rate 12% 21%
</TABLE>
(a) For the period from April 30, 1999 (commencement of class operations) to
June 30, 1999.
+ Annualized.
++ Ratio of expenses to average net assets includes fee waivers and excludes
expense reductions.
* Excluding applicable sales charges.
See Combined Notes to Financial Statements.
11
<PAGE>
EVERGREEN (formerly,
Special Equity Fund Evergreen
Financial Highlights Select
(For a share outstanding throughout each period) Special
Equity Fund)
<TABLE>
<CAPTION>
Year Ended June 30, Period Ended Year Ended
--------------------------------------- June 30, October 31,
2000 1999 (e) 1998 1997 1996 (b) (c) (d) 1995 (a)
<S> <C> <C> <C> <C> <C> <C>
CLASS I SHARES
Net asset value,
beginning of period $ 14.20 $ 11.25 $ 11.27 $ 11.86 $ 11.42 $ 9.37
-------- -------- ------- ------- ------- -------
Income from investment
operations
Net investment income
or loss (0.05) (0.02) (0.05) 0.02 0.07 0.12
Net realized and
unrealized gains or
losses
on securities 3.96 4.15 1.52 1.81 2.13 2.12
-------- -------- ------- ------- ------- -------
Total from investment
operations 3.91 4.13 1.47 1.83 2.20 2.24
-------- -------- ------- ------- ------- -------
Distributions to
shareholders from
Net investment income 0 0 0 (0.03) (0.07) (0.12)
Net realized gains (2.19) (1.18) (1.49) (2.39) (1.69) (0.07)
-------- -------- ------- ------- ------- -------
Total distributions to
shareholders (2.19) (1.18) (1.49) (2.42) (1.76) (0.19)
-------- -------- ------- ------- ------- -------
Net asset value, end of
period $ 15.92 $ 14.20 $ 11.25 $ 11.27 $ 11.86 $ 11.42
-------- -------- ------- ------- ------- -------
Total return 30.89% 42.02% 14.23% 17.94% 22.27% 24.44%
Ratios and supplemental
data
Net assets, end of
period (thousands) $192,146 $116,966 $73,981 $71,980 $63,680 $57,396
Ratios to average net
assets
Expenses++ 1.05% 1.06% 1.10% 0.84% 0.34%+ 0.32%
Net investment income
or loss (0.35%) (0.36%) (0.48%) 0.19% 0.94%+ 1.14%
Portfolio turnover rate 172% 99% 62% 74% 72% 129%
</TABLE>
(a) On February 21, 1995, the shares of the Fund were redesignated as either
Retail or Institutional Shares. On that date, the Fund's net investment in-
come, expenses and distributions for the period November 1, 1994 through
February 20, 1995 were allocated to each class of shares. The basis for the
allocation was the relative net assets of each class of shares as of Febru-
ary 21, 1995. The results were combined with the results of operations and
distributions for each applicable class for the period February 21, 1995
through October 31, 1995. For the year ended October 31, 1995, the Finan-
cial Highlights' reflect this allocation.
(b) For the period from November 1, 1995 to June 30, 1996. The Fund changed its
fiscal year end from October 31 to June 30, effective June 30, 1996.
(c) On April 15, 1996, the Conestoga Special Equity Fund was acquired by the
CoreFund Special Equity Fund ("CoreFund").
(d) On April 15, 1996, the Institutional Class shares of the CoreFund were ex-
changed for Class Y shares and the Retail Class shares of the CoreFund were
exchanged for Class A shares of the CoreFund.
(e) On July 24, 1998, the assets and certain liabilities of CoreFund were ac-
quired by Evergreen Select Special Equity Fund ("Special Equity Fund").
Shareholders of CoreFund Class Y became owners of that number of shares of
Special Equity Fund, Class I, having an aggregate net asset value equal to
the aggregate net asset value of their shares of CoreFund immediately prior
to the close of business on July 24, 1998. CoreFund is the accounting sur-
vivor, its basis of accounting for assets and liabilities and its operating
results for the periods prior to July 24, 1998 have been carried forward in
these financial statements.
+ Annualized.
++ Ratio of expenses to average net assets includes fee waivers and excludes
expense reductions.
See Combined Notes to Financial Statements.
12
<PAGE>
EVERGREEN (Formerly, Evergreen
Special Equity Fund Select Special
Financial Highlights Equity Fund)
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Year Ended June 30, Period Ended Year Ended
---------------------------------- June 30, October 31,
2000 1999 (e) 1998 1997 1996 (b) (c) (d) 1995 (a)
<S> <C> <C> <C> <C> <C> <C>
CLASS IS SHARES
Net asset value,
beginning of period $14.05 $11.18 $11.25 $11.85 $11.42 $ 9.37
------ ------ ------ ------ ------ ------
Income from investment
operations
Net investment income
or loss (0.10) (0.06) (0.10) 0 0.08 0.12
Net realized and
unrealized gains or
losses on securities 3.94 4.11 1.52 1.81 2.11 2.12
------ ------ ------ ------ ------ ------
Total from investment
operations 3.84 4.05 1.42 1.81 2.19 2.24
------ ------ ------ ------ ------ ------
Distributions to
shareholders from
Net investment income 0 0 0 (0.02) (0.07) (0.12)
Net realized gains (2.19) (1.18) (1.49) (2.39) (1.69) (0.07)
------ ------ ------ ------ ------ ------
Total distributions to
shareholders (2.19) (1.18) (1.49) (2.41) (1.76) (0.19)
------ ------ ------ ------ ------ ------
Net asset value, end of
period $15.70 $14.05 $11.18 $11.25 $11.85 $11.42
------ ------ ------ ------ ------ ------
Total return 30.70% 41.55% 13.78% 17.73% 22.14% 24.44%
Ratios and supplemental
data
Net assets, end of
period (thousands) $7,835 $4,043 $2,981 $2,347 $1,144 $ 734
Ratios to average net
assets
Expenses++ 1.30% 1.31% 1.35% 1.14% 0.37%+ 0.27%
Net investment income
or loss (0.61%) (0.61%) (0.73%) (0.12%) 0.91%+ 1.29%
Portfolio turnover rate 172% 99% 62% 74% 72% 129%
</TABLE>
(a) On February 21, 1995, the shares of the Fund were redesignated as either
Retail or Institutional Shares. On that date, the Fund's net investment in-
come, expenses and distributions for the period November 1, 1994 through
February 20, 1995 were allocated to each class of shares. The basis for the
allocation was the relative net assets of each class of shares as of Febru-
ary 21, 1995. The results were combined with the results of operations and
distributions for each applicable class for the period February 21, 1995
through October 31, 1995. For the year ended October 31, 1995, the Finan-
cial Highlights' reflect this allocation.
(b) For the period from November 1, 1995 to June 30, 1996. The Fund changed its
fiscal year end from October 31 to June 30, effective June 30, 1996.
(c) On April 15, 1996, the Conestoga Special Equity Fund was acquired by the
CoreFund Special Equity Fund ("CoreFund").
(d) On April 15, 1996, the Institutional Class shares of the CoreFund were ex-
changed for Class Y shares and the Retail Class shares of the CoreFund were
exchanged for Class A shares of the CoreFund.
(e) On July 24, 1998, the assets and certain liabilities of CoreFund were ac-
quired by Evergreen Select Special Equity Fund ("Special Equity Fund").
Shareholders of CoreFund Class A and Class B became owners of that number
of shares of Special Equity Fund, Class IS, having an aggregate net asset
value equal to the aggregate net asset value of their shares of CoreFund
immediately prior to the close of business on July 24, 1998. CoreFund is
the accounting survivor, its basis of accounting for assets and liabilities
and its operating results for the periods prior to July 24, 1998 have been
carried forward in these financial statements.
+ Annualized.
++ Ratio of expenses to average net assets includes fee waivers and excludes
expense reductions.
See Combined Notes to Financial Statements.
13
<PAGE>
EVERGREEN (formerly,
Special Equity Fund Evergreen
Financial Highlights Select
(For a share outstanding throughout each period) Special
Equity Fund)
<TABLE>
<CAPTION>
Period Ended
June 30, 2000 (a)
<S> <C>
CLASS A SHARES
Net asset value, beginning of period $ 13.97
-------
Income from investment operations
Net investment loss (0.04)
Net realized and unrealized gains on securities 3.93
-------
Total from investment operations 3.89
-------
Distributions to shareholders from
Net realized gains (2.19)
-------
Total distributions to shareholders (2.19)
-------
Net asset value, end of period $ 15.67
-------
Total return* 31.20%
Ratios and supplemental data
Net assets, end of period (thousands) $35,390
Ratios to average net assets
Expenses++ 1.31%+
Net investment loss (0.61%)+
Portfolio turnover rate 172%
</TABLE>
<TABLE>
<CAPTION>
Period Ended
June 30, 2000 (a)
<S> <C>
CLASS B SHARES
Net asset value, beginning of period $ 13.97
-------
Income from investment operations
Net investment loss (0.08)
Net realized and unrealized gains on securities 3.89
-------
Total from investment operations 3.81
-------
Distributions to shareholders from
Net realized gains (2.19)
-------
Total distributions to shareholders (2.19)
-------
Net asset value, end of period $ 15.59
-------
Total return* 30.54%
Ratios and supplemental data
Net assets, end of period (thousands) $40,898
Ratios to average net assets
Expenses++ 2.06%+
Net investment loss (1.36%)+
Portfolio turnover rate 172%
</TABLE>
(a) For the period from August 30, 1999 (commencement of class operations) to
June 30, 2000.
+ Annualized.
++ Ratio of expenses to average net assets includes fee waivers and excludes
expense reductions.
* Excluding applicable sales charges.
See Combined Notes to Financial Statements.
14
<PAGE>
EVERGREEN (formerly,
Special Equity Fund Evergreen
Financial Highlights Select
(For a share outstanding throughout each period) Special
Equity Fund)
<TABLE>
<CAPTION>
Period Ended
June 30, 2000 (a)
<S> <C>
CLASS C SHARES
Net asset value, beginning of period $ 13.97
-------
Income from investment operations
Net investment loss (0.09)
Net realized and unrealized gains on securities 3.90
-------
Total from investment operations 3.81
-------
Distributions to shareholders from
Net realized gains (2.19)
-------
Total distributions to shareholders (2.19)
-------
Net asset value, end of period $ 15.59
-------
Total return* 30.53%
Ratios and supplemental data
Net assets, end of period (thousands) $25,769
Ratios to average net assets
Expenses++ 2.06%+
Net investment loss (1.36%)+
Portfolio turnover rate 172%
</TABLE>
(a) For the period from August 30, 1999 (commencement of class operations) to
June 30, 2000.
+ Annualized.
++ Ratio of expenses to average net assets includes fee waivers and excludes
expense reductions.
* Excluding applicable sales charges.
See Combined Notes to Financial Statements.
15
<PAGE>
EVERGREEN (formerly,
Equity Index Fund Evergreen
Schedule of Investments Select
June 30, 2000 Equity Index
Fund)
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
COMMON STOCKS - 97.4%
CONSUMER DISCRETIONARY - 10.8%
Auto Components - 0.3%
Cooper Tire & Rubber Co. ........................ 11,200 $ 124,600
Dana Corp. #..................................... 9,913 210,032
Delphi Automotive Systems Corp. ................. 40,915 595,825
Eaton Corp. ..................................... 4,400 294,800
Genuine Parts Co. #.............................. 11,900 238,000
Goodyear Tire & Rubber Co. ...................... 11,280 225,600
Johnson Controls, Inc. #......................... 5,000 256,562
TRW, Inc. ....................................... 8,000 347,000
Visteon Corp. ................................... 11,103 134,624
------------
2,427,043
------------
Automobiles - 0.8%
Ford Motor Co. .................................. 84,800 3,646,400
General Motors Corp. ............................ 38,800 2,252,825
Harley-Davidson, Inc. ........................... 21,200 816,200
------------
6,715,425
------------
Distributors - 0.0%
W.W. Grainger, Inc. #............................ 6,000 184,875
------------
Hotels, Restaurants & Leisure - 0.7%
Carnival Corp., Class A.......................... 42,000 819,000
Darden Restaurants, Inc. ........................ 9,000 146,250
Harrahs Entertainment, Inc. *.................... 10,300 215,656
Hilton Hotels Corp. ............................. 31,300 293,437
Marriott International, Inc., Class A #.......... 15,400 555,362
McDonald's Corp. ................................ 92,500 3,046,719
Starbucks Corp. *#............................... 12,900 492,619
Tricon Global Restaurants, Inc. *................ 11,000 310,750
Wendy's International, Inc. ..................... 11,800 210,188
------------
6,089,981
------------
Household Durables - 0.3%
Black & Decker Corp. #........................... 5,900 231,944
Centex Corp. .................................... 10,100 237,350
Kaufman & Broad Home Corp. ...................... 4,400 87,175
Leggett & Platt, Inc. #.......................... 8,800 145,200
Maytag Corp. .................................... 5,900 217,562
Newell Rubbermaid, Inc. ......................... 18,191 468,418
Pulte Corp. ..................................... 4,400 95,150
Snap-on, Inc. #.................................. 1,000 26,625
Stanley Works #.................................. 6,600 156,750
Tupperware Corp. #............................... 15,300 336,600
Whirlpool Corp. ................................. 5,600 261,100
------------
2,263,874
------------
</TABLE>
16
<PAGE>
EVERGREEN (formerly,
Equity Index Fund Evergreen
Schedule of Investments (continued) Select
June 30, 2000 Equity Index
Fund)
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
COMMON STOCKS - continued
CONSUMER DISCRETIONARY - continued
Leisure Equipment & Products - 0.2%
Brunswick Corp. .................................... 14,700 $ 243,469
Eastman Kodak Co. .................................. 20,700 1,231,650
Hasbro, Inc. ....................................... 11,900 179,244
Mattel, Inc. ....................................... 25,850 340,897
Polaroid Corp. ..................................... 1,000 18,062
------------
2,013,322
------------
Media - 3.8%
Clear Channel Communications, Inc. *#............... 23,000 1,725,000
Comcast Corp., Class A.............................. 63,200 2,559,600
Disney (Walt) Co. .................................. 144,078 5,592,027
Dow Jones & Co., Inc. .............................. 6,200 454,150
Gannett Co., Inc. .................................. 18,300 1,094,569
Harcourt General, Inc. #............................ 3,600 195,750
Interpublic Group of Companies, Inc. ............... 19,700 847,100
Knight-Ridder, Inc. #............................... 7,100 377,631
MediaOne Group, Inc. *.............................. 44,200 2,922,725
New York Times Co., Class A......................... 12,200 481,900
Omnicom Group, Inc. ................................ 11,800 1,050,938
Seagram Co., Ltd. #................................. 31,600 1,832,800
Time Warner, Inc. #................................. 90,600 6,885,600
Tribune Co. ........................................ 19,900 696,500
Viacom, Inc., Class B............................... 108,768 7,416,618
Young & Rubicam, Inc. .............................. 4,900 280,219
------------
34,413,127
------------
Multi-line Retail - 2.8%
Consolidated Stores Corp. *#........................ 12,200 146,400
Costco Wholesale Corp. *............................ 33,600 1,108,800
Dillards, Inc., Class A............................. 10,100 123,725
Dollar General Corp. ............................... 19,281 375,980
Federated Department Stores, Inc. *#................ 13,400 452,250
J.C. Penney Co., Inc. #............................. 18,300 337,406
Kmart Corp. *....................................... 34,750 236,734
Kohl's Corp. *...................................... 22,900 1,273,812
May Deptartment Stores Co. ......................... 25,800 619,200
Sears, Roebuck & Co. #.............................. 25,900 844,988
Target Corp. ....................................... 30,300 1,757,400
Wal-Mart Stores, Inc. .............................. 312,890 18,030,286
------------
25,306,981
------------
Specialty Retail - 1.8%
Autozone, Inc. *.................................... 8,700 191,400
Bed Bath & Beyond, Inc. *........................... 9,100 329,875
</TABLE>
17
<PAGE>
EVERGREEN (formerly,
Equity Index Fund Evergreen
Schedule of Investments(continued) Select
June 30, 2000 Equity Index
Fund)
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
COMMON STOCKS - continued
CONSUMER DISCRETIONARY - continued
Specialty Retail - continued
Best Buy Co., Inc. *................................ 14,300 $ 904,475
Circuit City Stores, Inc. .......................... 15,100 501,131
Gap, Inc. .......................................... 61,800 1,931,250
Home Depot, Inc. ................................... 161,897 8,084,731
Limited, Inc. #..................................... 28,188 609,566
Lowe's Companies, Inc. ............................. 27,600 1,133,325
Nordstrom, Inc. .................................... 8,800 212,300
Office Depot, Inc. *#............................... 24,100 150,625
RadioShack Corp. ................................... 13,000 615,875
Staples, Inc. *..................................... 32,450 498,919
Tiffany & Co. #..................................... 4,200 283,500
TJX Co., Inc. ...................................... 19,700 369,375
Toys "R" Us, Inc. *#................................ 10,000 145,625
------------
15,961,972
------------
Textiles & Apparel - 0.1%
Nike, Inc., Class B................................. 18,600 740,513
Russell Corp. ...................................... 3,100 62,000
Springs Industries, Inc. ........................... 7,100 228,531
V.F. Corp. #........................................ 7,900 188,119
------------
1,219,163
------------
CONSUMER STAPLES - 6.3%
Beverages - 2.0%
Adolph Coors Co. #.................................. 3,500 211,750
Anheuser Busch Cos., Inc. .......................... 32,700 2,442,281
Brown Forman Corp., Class B......................... 3,700 198,875
Coca Cola Co. #..................................... 173,310 9,954,493
Coca Cola Enterprises, Inc. ........................ 28,800 469,800
Pepsico, Inc. ...................................... 102,800 4,568,175
------------
17,845,374
------------
Food & Drug Retailing - 0.9%
Albertsons, Inc. ................................... 31,895 1,060,509
CVS Corp. .......................................... 26,200 1,048,000
Great Atlantic & Pacific Tea, Inc. ................. 6,500 108,063
Kroger Co. *........................................ 54,500 1,202,406
Rite Aid Corp. #.................................... 20,900 137,156
Safeway, Inc. *..................................... 34,100 1,538,762
SYSCO Corp. ........................................ 23,800 1,002,575
Walgreen Co. ....................................... 72,800 2,343,250
Winn Dixie Stores, Inc. #........................... 1,900 27,194
------------
8,467,915
------------
</TABLE>
18
<PAGE>
EVERGREEN (formerly,
Equity Index Fund Evergreen
Schedule of Investments(continued) Select
June 30, 2000 Equity Index
Fund)
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
COMMON STOCKS - continued
CONSUMER STAPLES - continued
Food Products - 1.3%
Archer Daniels Midland Co. ......................... 40,272 $ 395,169
Bestfoods #......................................... 19,000 1,315,750
Campbell Soup Co. .................................. 31,800 926,175
Conagra, Inc. #..................................... 31,800 606,188
General Mills, Inc. ................................ 20,800 795,600
H.J. Heinz Co. #.................................... 23,450 1,025,937
Hershey Foods Corp. ................................ 11,100 538,350
Kellogg Co. #....................................... 26,300 782,425
Nabisco Group Holding Corp. ........................ 24,000 622,500
Quaker Oats Co. .................................... 9,000 676,125
Ralston Purina Co. ................................. 22,700 452,581
Sara Lee Corp. ..................................... 55,100 1,064,119
Unilever NV #....................................... 41,575 1,787,725
Wrigley (W.M.) Junior Co. #......................... 8,100 649,519
------------
11,638,163
------------
Health Care Equipment & Supplies - 0.0%
SuperValu, Inc. .................................... 9,800 186,813
------------
Household Products - 0.6%
American Greetings Corp., Class A................... 1,000 19,000
Procter & Gamble Co. ............................... 93,900 5,375,775
------------
5,394,775
------------
Personal Products - 1.0%
Alberto Culver Co., Class B #....................... 1,000 30,563
Avon Products, Inc. #............................... 17,000 756,500
Clorox Co. #........................................ 15,800 708,037
Colgate-Palmolive Co. .............................. 41,384 2,477,867
Gillette Co. ....................................... 75,000 2,620,312
International Flavours & Fragrances, Inc. .......... 1,000 30,188
Kimberly-Clark Corp. ............................... 38,804 2,226,379
------------
8,849,846
------------
Tobacco - 0.5%
Philip Morris Cos., Inc. ........................... 163,900 4,353,594
UST, Inc. .......................................... 10,400 152,750
------------
4,506,344
------------
ENERGY - 5.3%
Energy Equipment & Services - 0.7%
Baker Hughes, Inc. ................................. 21,000 672,000
Halliburton Co. #................................... 30,400 1,434,500
Rowan Companies, Inc. *............................. 11,600 352,350
</TABLE>
19
<PAGE>
EVERGREEN (formerly,
Equity Index Fund Evergreen
Schedule of Investments(continued) Select
June 30, 2000 Equity Index
Fund)
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
COMMON STOCKS - continued
ENERGY - continued
Energy Equipment & Services - continued
Schlumberger, Ltd. #................................ 38,400 $ 2,865,600
Transocean Sedco Forex, Inc. ....................... 14,685 784,729
------------
6,109,179
------------
Oil & Gas - 4.6%
Amerada Hess Corp. ................................. 6,000 370,500
Anadarko Petroleum Corp. #.......................... 9,700 478,331
Apache Corp. ....................................... 8,500 499,906
Ashland, Inc. ...................................... 3,900 136,744
Burlington Resources, Inc. ......................... 14,900 569,925
Chevron Corp. ...................................... 46,600 3,952,262
Conoco, Inc., Class B............................... 42,062 1,033,148
Exxon Mobil Corp. .................................. 242,228 19,014,898
Kerr-McGee Corp. ................................... 8,292 488,710
Occidental Petroleum Corp. ......................... 21,500 452,844
Phillips Petroleum Co. ............................. 17,300 876,894
Royal Dutch Petroleum Co. #......................... 150,000 9,234,375
Sunoco, Inc. #...................................... 12,600 370,912
Texaco, Inc. ....................................... 37,700 2,007,525
Tosco Corp. ........................................ 9,500 268,969
Union Pacific Resource Group, Inc. #................ 14,629 321,838
Unocal Corp. ....................................... 15,000 496,875
USX Marathon Group #................................ 22,300 558,894
------------
41,133,550
------------
FINANCIALS - 12.5%
Banks - 4.4%
AmSouth Bancorp..................................... 26,850 422,888
Bank of America Corp. .............................. 114,843 4,938,249
Bank One Corp. ..................................... 80,099 2,127,630
BB&T Corp. #........................................ 26,300 627,913
Charter One Financial, Inc. ........................ 12,900 296,700
Chase Manhattan Corp. .............................. 85,298 3,929,039
Comerica, Inc. ..................................... 11,550 518,306
Fifth Third Bancorp................................. 22,250 1,407,312
First Union Corp. * *............................... 68,960 1,711,070
Firstar Corp. ...................................... 70,573 1,486,444
FleetBoston Financial Corp. ........................ 60,434 2,054,756
Golden West Financial Corp. #....................... 13,800 563,213
Huntington Bancshares, Inc. #....................... 16,160 255,530
J.P. Morgan & Co., Inc. ............................ 11,300 1,244,412
KeyCorp............................................. 30,600 539,325
Mellon Financial Corp. ............................. 35,600 1,297,175
National City Corp. ................................ 41,600 709,800
</TABLE>
20
<PAGE>
EVERGREEN (formerly,
Equity Index Fund Evergreen
Schedule of Investments(continued) Select
June 30, 2000 Equity Index
Fund)
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
COMMON STOCKS - continued
FINANCIALS - continued
Banks - continued
Northern Trust Corp. ............................... 15,200 $ 988,950
Old Kent Financial Corp. ........................... 8,610 230,318
PNC Financial Services Group........................ 20,500 960,937
Regions Financial Corp. #........................... 14,400 286,200
SouthTrust Corp. ................................... 12,500 282,813
State Street Corp. ................................. 10,600 1,124,262
Summit Bancorp...................................... 12,600 310,275
Suntrust Banks, Inc. ............................... 21,600 986,850
Synovus Financial Corp. ............................ 21,300 375,413
The Bank of New York Co., Inc. ..................... 51,500 2,394,750
U.S. Bancorp........................................ 49,238 947,831
Union Planters Corp. ............................... 12,100 338,044
Wachovia Corp. #.................................... 13,800 748,650
Washington Mutual, Inc. #........................... 39,710 1,146,626
Wells Fargo Co. #................................... 109,830 4,255,912
------------
39,507,593
------------
Diversified Financials - 5.3%
American Express Co. ............................... 92,000 4,795,500
Associates First Capital Corp., Class A............. 48,648 1,085,458
Bear Stearns Companies, Inc. ....................... 6,635 276,182
Capital One Financial Corp. ........................ 12,900 575,662
Citigroup, Inc. .................................... 236,593 14,254,728
Countrywide Credit Industries, Inc. ................ 7,900 239,469
Crane Co. .......................................... 5,200 126,425
Federal Home Loan Mortgage Assn. ................... 47,300 1,915,650
Federal National Mortgage Assn. .................... 68,800 3,590,500
Fortune Brands, Inc. ............................... 12,000 276,750
Franklin Resources, Inc. ........................... 16,300 495,113
Household International, Inc. ...................... 31,359 1,303,358
Lehman Brothers Holdings, Inc. ..................... 9,300 879,431
MBNA Corp. ......................................... 59,230 1,606,614
Merrill Lynch & Co., Inc. .......................... 26,400 3,036,000
Morgan Stanley, Dean Witter & Co. .................. 79,200 6,593,400
National Service Industries, Inc. .................. 9,700 189,150
Paine Webber Group, Inc. ........................... 11,200 509,600
Price (T.) Rowe & Associates, Inc. ................. 7,900 335,750
Providian Financial Corp. #......................... 10,800 972,000
Ryder Systems, Inc. ................................ 6,200 117,413
Schwab (Charles) & Co., Inc. ....................... 93,000 3,127,125
SLM Holding Corp. #................................. 10,100 378,119
Textron, Inc. ...................................... 10,000 543,125
------------
47,222,522
------------
</TABLE>
21
<PAGE>
EVERGREEN (formerly,
Equity Index Fund Evergreen
Schedule of Investments(continued) Select
June 30, 2000 Equity Index
Fund)
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
COMMON STOCKS - continued
FINANCIALS - continued
Insurance - 2.8%
AFLAC, Inc. ........................................ 20,600 $ 946,312
Allstate Corp. ..................................... 54,500 1,212,625
American General Corp. #............................ 16,916 1,031,876
American International Group, Inc. #................ 109,076 12,816,430
Aon Corp. #......................................... 17,125 531,945
Chubb Corp. ........................................ 12,000 738,000
CIGNA Corp. ........................................ 10,900 1,019,150
Cincinnati Financial Corp. ......................... 10,400 326,950
Hartford Financial Services Group, Inc. #........... 15,400 861,437
Jefferson Pilot Corp. .............................. 7,800 440,213
Lincoln National Corp. ............................. 13,000 469,625
Loews Corp. ........................................ 7,000 420,000
Marsh & McLennan Co., Inc. ......................... 18,200 1,900,762
MBIA, Inc. ......................................... 7,800 375,863
MGIC Investment Corp. .............................. 8,000 364,000
Progressive Corp. .................................. 4,700 347,800
SAFECO Corp. #...................................... 1,000 19,875
St. Paul Companies, Inc. #.......................... 15,916 543,134
Torchmark Corp. .................................... 12,100 298,719
UnumProvident Corp. ................................ 15,757 316,125
------------
24,980,841
------------
HEALTH CARE - 11.6%
Biotechnology - 0.8
Amgen, Inc. *....................................... 73,000 5,128,250
Biogen, Inc. *...................................... 10,500 677,250
MedImmune, Inc. *................................... 14,000 1,036,000
------------
6,841,500
------------
Health Care Equipment & Supplies - 1.2%
Alza Corp. * #...................................... 6,400 378,400
Bausch & Lomb, Inc. #............................... 4,000 309,500
Baxter International, Inc. #........................ 19,600 1,378,125
Becton Dickinson & Co. ............................. 21,700 622,519
Biomet, Inc. ....................................... 9,200 353,625
Boston Scientific Corp. *........................... 27,100 594,506
C.R. Bard, Inc. #................................... 4,600 221,375
Guidant Corp. *..................................... 20,400 1,009,800
Mallinckrodt, Inc. ................................. 2,300 99,906
Medtronic, Inc. .................................... 86,000 4,283,875
PE Corp-PE Biosystems Group......................... 15,300 1,007,887
St. Jude Medical, Inc. *............................ 4,700 215,613
------------
10,475,131
------------
</TABLE>
22
<PAGE>
EVERGREEN (formerly,
Equity Index Fund Evergreen
Schedule of Investments(continued) Select
June 30, 2000 Equity Index
Fund)
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
COMMON STOCKS - continued
HEALTH CARE - continued
Health Care Providers & Services - 0.7%
Aetna, Inc. #....................................... 10,208 $ 655,226
Cardinal Health, Inc. .............................. 20,300 1,502,200
HCA-The Healthcare Corp. #.......................... 37,950 1,152,731
HEALTHSOUTH Corp. .................................. 2,000 14,375
IMS Health, Inc. ................................... 21,200 381,600
Manor Care, Inc. *.................................. 1,000 7,000
McKesson HBOC, Inc. ................................ 17,829 373,295
Shared Medical System Corp. ........................ 5,100 371,981
Tenet Healthcare Corp. *............................ 20,000 540,000
UnitedHealth Group, Inc. ........................... 12,400 1,063,300
Wellpoint Health Networks, Inc., Class A * #........ 4,500 325,969
------------
6,387,677
------------
Pharmaceuticals - 8.9%
Abbott Laboratories................................. 107,600 4,794,925
Allergan, Inc. ..................................... 8,600 640,700
American Home Products Corp. ....................... 93,900 5,516,625
Bristol-Myers Squibb Co. ........................... 139,000 8,096,750
Johnson & Johnson................................... 97,500 9,932,812
Lilly (Eli) & Co. .................................. 77,700 7,760,288
Merck & Co., Inc. .................................. 160,600 12,305,975
Pfizer, Inc. ....................................... 440,225 21,130,800
Pharmacia Corp. .................................... 87,858 4,541,160
Schering-Plough Corp. .............................. 103,200 5,211,600
Watson Pharmaceuticals, Inc. * #.................... 7,800 419,250
------------
80,350,885
------------
INDUSTRIALS - 9.1%
Aerospace & Defense - 0.8%
B.F. Goodrich Co. .................................. 6,700 228,219
Boeing Co. ......................................... 65,570 2,741,646
General Dynamics Corp. ............................. 13,300 694,925
Lockheed Martin Corp. #............................. 25,800 640,162
Northrop Grumman Corp. ............................. 5,300 351,125
Perkinelmer, Inc. .................................. 2,000 132,250
Raytheon Co., Class B #............................. 23,100 444,675
United Technologies Corp. #......................... 32,900 1,936,987
------------
7,169,989
------------
Air Freight & Couriers - 0.1%
FedEx Corp. ........................................ 19,000 722,000
------------
Airlines - 0.2%
AMR Corp. *......................................... 10,000 264,375
Delta Air Lines, Inc. .............................. 9,000 455,063
</TABLE>
23
<PAGE>
EVERGREEN (formerly,
Equity Index Fund Evergreen
Schedule of Investments(continued) Select
June 30, 2000 Equity Index
Fund)
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
COMMON STOCKS - continued
INDUSTRIALS - continued
Airlines - continued
Southwest Airlines Co. ............................. 36,300 $ 687,431
US Airways Group, Inc. *............................ 1,700 66,300
------------
1,473,169
------------
Building Products - 0.1%
Armstrong Holdings, Inc. ........................... 1,000 15,313
Masco Corp. ........................................ 28,000 505,750
------------
521,063
------------
Commercial Services & Supplies - 1.6%
Allied Waste Industries, Inc. * #................... 23,100 231,000
Automatic Data Processing, Inc. .................... 44,745 2,396,654
Avery Dennison Corp. ............................... 7,400 496,725
Cendant Corp. * #................................... 47,374 663,236
Ceridian Corp. *.................................... 10,300 247,844
Computer Sciences Corp. *........................... 11,300 843,969
Convergys Corp. *................................... 10,700 555,062
Deluxe Corp. ....................................... 8,400 197,925
Donnelley (R.R.) & Sons Co. ........................ 6,900 155,681
Dun & Bradstreet Corp. #............................ 10,000 286,250
Electronic Data Systems Corp. ...................... 35,600 1,468,500
Equifax, Inc. ...................................... 8,100 212,625
First Data Corp. ................................... 28,600 1,419,275
H&R Block, Inc. #................................... 5,000 161,875
McGraw-Hill Cos., Inc. ............................. 14,000 756,000
Paychex, Inc. ...................................... 25,425 1,067,850
Pitney Bowes, Inc. ................................. 18,400 736,000
Sabre Group Holdings, Inc. Class A * #.............. 13,926 396,891
Waste Management, Inc. ............................. 40,120 762,280
Xerox Corp. #....................................... 45,000 933,750
------------
13,989,392
------------
Construction & Engineering - 0.0%
Fluor Corp. #....................................... 4,400 139,150
------------
Electrical Equipment - 0.3%
American Power Conversion Corp. *................... 13,500 550,969
Cooper Industries, Inc. ............................ 5,200 169,325
Emerson Electric Co. ............................... 29,100 1,756,912
Molex, Inc. #....................................... 13,375 643,672
------------
3,120,878
------------
Industrial Conglomerates - 5.3%
Danaher Corp. ...................................... 9,000 444,938
Dover Corp. ........................................ 15,000 608,437
General Electric Co. ............................... 691,200 36,633,600
</TABLE>
24
<PAGE>
EVERGREEN (formerly,
Equity Index Fund Evergreen
Schedule of Investments (continued) Select
June 30, 2000 Equity Index
Fund)
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
COMMON STOCKS - continued
INDUSTRIALS - continued
Industrial Conglomerates - continued
Honeywell International, Inc. ...................... 54,262 $ 1,827,951
ITT Industries, Inc. ............................... 7,500 227,813
Minnesota Mining & Manufacturing Co. ............... 27,500 2,268,750
Thermo Electron Corp. *............................. 10,900 229,581
Tyco International, Ltd. ........................... 118,236 5,601,430
------------
47,842,500
------------
Machinery - 0.4%
Caterpillar, Inc. .................................. 23,100 782,512
Cummins Engine, Inc. ............................... 6,000 163,500
Deere & Co. ........................................ 15,500 573,500
Illinois Tool Works, Inc. .......................... 20,600 1,174,200
Ingersoll Rand Co. #................................ 11,000 442,750
Navistar International Corp., Inc. * #.............. 2,000 62,125
Paccar, Inc. #...................................... 4,000 158,750
Parker Hannifin Corp. .............................. 6,275 214,919
Timken Co. ......................................... 11,900 221,638
------------
3,793,894
------------
Road & Rail - 0.3%
Burlington Northern Santa Fe Corp. ................. 30,992 710,879
CSX Corp. .......................................... 14,000 296,625
Kansas City Southern Industries, Inc. .............. 7,900 700,631
Norfolk Southern Corp. ............................. 25,600 380,800
Union Pacific Corp. #............................... 19,700 732,594
------------
2,821,529
------------
INFORMATION TECHNOLOGY - 31.0%
Communications Equipment - 8.6%
3Com Corp. *........................................ 25,100 1,446,388
Adaptec, Inc. ...................................... 13,200 300,300
Cabletron Systems, Inc. ............................ 12,700 320,675
Cisco Systems, Inc. *............................... 485,300 30,846,881
Comverse Technology, Inc. * #....................... 10,800 1,004,400
Corning, Inc. ...................................... 19,600 5,289,550
Lucent Technologies, Inc. #......................... 225,690 13,372,133
Motorola, Inc. #.................................... 149,991 4,359,113
Nortel Networks Corp. #............................. 205,500 14,025,375
Qualcomm, Inc. *.................................... 51,600 3,096,000
Scientific Atlanta, Inc. ........................... 12,000 894,000
Tellabs, Inc. *..................................... 29,100 1,991,531
------------
76,946,346
------------
</TABLE>
25
<PAGE>
EVERGREEN (formerly,
Equity Index Fund Evergreen
Schedule of Investments (continued) Select
June 30, 2000 Equity Index
Fund)
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
COMMON STOCKS - continued
INFORMATION TECHNOLOGY - continued
Computers & Peripherals - 6.9%
Apple Computer *.................................... 23,400 $ 1,225,575
Compaq Computer Corp. .............................. 120,985 3,092,679
Dell Computer Corp. *............................... 179,500 8,851,594
EMC Corp. *......................................... 149,220 11,480,614
Gateway, Inc. *..................................... 21,600 1,225,800
Hewlett-Packard Co. #............................... 69,700 8,703,788
International Business Machines Corp. .............. 123,800 13,563,837
Lexmark Intl. Group, Inc., Class A * #.............. 9,200 618,700
NCR Corp. * #....................................... 6,700 260,881
Network Appliance, Inc. ............................ 21,000 1,690,500
Seagate Technology * #.............................. 15,900 874,500
Sun Microsystems, Inc. *............................ 111,300 10,121,344
Unisys Corp. * #.................................... 21,700 316,006
------------
62,025,818
------------
Electronic Equipment & Instruments - 0.6%
Agilent Technologies, Inc. ......................... 31,683 2,336,622
Andrew Corp. *...................................... 5,700 191,306
Rockwell International Corp. ....................... 13,300 418,950
Sanmina Corp. * #................................... 10,400 889,200
Solectron Corp. * #................................. 41,600 1,742,000
Tektronix, Inc. .................................... 3,600 266,400
------------
5,844,478
------------
Internet Software & Services - 1.5%
America Online, Inc. *.............................. 159,700 8,424,175
Yahoo!, Inc. *...................................... 37,500 4,645,312
------------
13,069,487
------------
Semiconductor Equipment & Products - 6.8%
Advanced Micro Devices, Inc. * #.................... 10,300 795,675
Altera Corp. *...................................... 14,000 1,427,125
Analog Devices, Inc. *.............................. 24,400 1,854,400
Applied Materials, Inc. *........................... 56,400 5,111,250
Conexant Systems, Inc. * #.......................... 13,800 671,025
Intel Corp. ........................................ 234,800 31,389,825
KLA-Tencor Corp. * #................................ 13,800 808,163
Linear Technology Corp. #........................... 21,700 1,387,444
LSI Logic Corp. *................................... 21,100 1,142,037
Maxim Integrated Products, Inc. *................... 19,400 1,317,987
Micron Technology, Inc. ............................ 38,400 3,381,600
National Semiconductor Corp. *...................... 12,500 709,375
Novellus Systems, Inc. *............................ 8,300 469,469
Teradyne, Inc. *.................................... 12,500 918,750
</TABLE>
26
<PAGE>
EVERGREEN (formerly,
Equity Index Fund Evergreen
Schedule of Investments (continued) Select
June 30, 2000 Equity Index
Fund)
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
COMMON STOCKS - continued
INFORMATION TECHNOLOGY - continued
Semiconductor Equipment & Products - continued
Texas Instruments, Inc. ............................ 113,600 $ 7,802,900
Xilinx, Inc. *...................................... 22,100 1,824,631
------------
61,011,656
------------
Software - 6.4%
Adobe Systems, Inc. ................................ 8,600 1,118,000
Autodesk, Inc. ..................................... 7,000 242,812
BMC Software, Inc. *................................ 18,100 660,367
Citrix Systems, Inc. *.............................. 12,000 227,250
Computer Associates International, Inc. ............ 41,075 2,102,527
Compuware Corp. *................................... 25,000 259,375
Mercury Interactive Corp. *......................... 2,600 251,550
Microsoft Corp. *................................... 366,300 29,304,000
Novell, Inc. *...................................... 1,500 13,875
Oracle Systems Corp. *.............................. 197,486 16,601,167
Parametric Technology Corp. *....................... 26,600 292,600
Peoplesoft, Inc. *.................................. 18,700 313,225
Sapient Corp. *..................................... 4,100 438,444
Siebel Systems, Inc. *.............................. 13,500 2,208,094
Veritas Software Corp. * #.......................... 26,500 2,994,914
------------
57,028,200
------------
Specialty Retail - 0.2%
ADC Telecommunications, Inc. * #.................... 23,400 1,962,675
------------
MATERIALS - 2.0%
Chemicals - 1.0%
Air Products & Chemicals, Inc. ..................... 14,700 452,944
Dow Chemical Co. ................................... 47,850 1,444,472
DuPont (E.I.) De Nemours & Co. ..................... 72,999 3,193,706
Eastman Chemical Co. ............................... 4,000 191,000
Ecolab, Inc. ....................................... 10,500 410,156
Engelhard Corp. .................................... 3,300 56,306
FMC Corp. *......................................... 5,900 342,200
Grace (W.R.) & Co. *................................ 12,300 149,138
Great Lakes Chemical Corp. #........................ 9,000 283,500
Millipore Corp. .................................... 4,200 316,575
Pall Corp. ......................................... 8,700 160,950
PPG Industries, Inc. ............................... 11,400 505,163
Praxair, Inc. #..................................... 11,300 423,044
Rohm & Haas Co. #................................... 17,575 606,337
Sherwin Williams Co. ............................... 10,700 226,706
Sigma-Aldrich Corp. #............................... 5,000 146,250
Union Carbide Corp. ................................ 9,200 455,400
------------
9,363,847
------------
</TABLE>
27
<PAGE>
EVERGREEN (formerly,
Equity Index Fund Evergreen
Schedule of Investments (continued) Select
June 30, 2000 Equity Index
Fund)
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
COMMON STOCKS - continued
MATERIALS - continued
Construction Materials - 0.0%
Vulcan Materials Co. #............................... 6,600 $ 281,738
------------
Containers & Packaging - 0.1%
Ball Corp. #......................................... 2,800 90,125
Bemis Co., Inc. ..................................... 4,000 134,500
Crown Cork & Seal Co., Inc. ......................... 8,200 123,000
Owens Illinois, Inc. *#.............................. 8,800 102,850
Pactiv Corp. *....................................... 15,800 124,425
Sealed Air Corp. *................................... 5,361 280,782
Temple Inland, Inc. ................................. 2,800 117,600
------------
973,282
------------
Metals & Mining - 0.5%
Alcan Aluminum, Ltd. #............................... 15,200 471,200
Alcoa, Inc. ......................................... 60,820 1,763,780
Allegheny Technologies, Inc. ........................ 6,150 110,700
Barrick Gold Corp. .................................. 27,300 496,519
Bethlehem Steel Corp. *.............................. 10,000 35,625
Freeport McMoran Copper & Gold, Inc., Class B *...... 9,700 89,725
Homestake Mining Co. ................................ 23,300 160,188
Inco, Ltd. .......................................... 13,600 209,100
Newmont Mining Corp. ................................ 9,970 215,601
Nucor Corp. ......................................... 4,400 146,025
Phelps Dodge Corp. #................................. 8,400 312,375
Placer Dome, Inc. ................................... 19,400 185,512
USX United States Steel Group #...................... 8,000 148,500
Worthington Industries, Inc. ........................ 7,000 73,500
------------
4,418,350
------------
Paper & Forest Products - 0.4%
Boise Cascade Corp. ................................. 6,401 165,626
Fort James Corp. .................................... 15,400 356,125
Georgia-Pacific Corp. #.............................. 10,800 283,500
International Paper Co. ............................. 33,365 994,694
Mead Corp. .......................................... 7,400 186,850
Potlatch Corp. #..................................... 6,100 202,062
Westvaco Corp. ...................................... 5,000 124,063
Weyerhaeuser Co. .................................... 16,106 692,558
Willamette Industries, Inc. ......................... 7,800 212,550
------------
3,218,028
------------
</TABLE>
28
<PAGE>
EVERGREEN (formerly,
Equity Index Fund Evergreen
Schedule of Investments (continued) Select
June 30, 2000 Equity Index
Fund)
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
COMMON STOCKS - continued
TELECOMMUNICATION SERVICES - 6.4%
Diversified Telecommunication Services - 5.6%
ALLTEL Corp. ....................................... 21,400 $ 1,325,463
AT&T Corp. ......................................... 216,727 6,853,991
Bell Atlantic Corp. #............................... 109,124 5,544,863
BellSouth Corp. .................................... 132,200 5,635,025
Centurytel, Inc. ................................... 9,300 267,375
Global Crossing, Ltd. *............................. 57,385 1,509,943
GTE Corp. .......................................... 67,100 4,176,975
SBC Communications, Inc. ........................... 235,181 10,171,578
Sprint Corp. #...................................... 62,200 3,172,200
U.S. West, Inc. .................................... 35,995 3,086,571
WorldCom, Inc. ..................................... 199,100 9,133,713
------------
50,877,697
------------
Wireless Telecommunications Services - 0.8%
Nextel Communications, Inc., Class A *.............. 52,000 3,181,750
Sprint Corp. (PCS Group), Ser. 1 *#................. 62,900 3,742,550
------------
6,924,300
------------
UTILITIES - 2.4%
Electric Utilities - 1.6%
AES Corp. *#........................................ 33,000 1,505,625
Ameren Corp. #...................................... 8,600 290,250
American Electric Power Co., Inc. .................. 21,300 631,012
Cinergy Corp. #..................................... 8,500 216,219
CMS Energy Corp. ................................... 1,000 22,125
Consolidated Edison, Inc. .......................... 17,600 521,400
Constellation Energy Group, Inc. ................... 9,500 309,344
Dominion Resources, Inc. ........................... 20,364 873,106
DTE Energy Co. ..................................... 10,300 314,794
Duke Energy Corp. .................................. 24,886 1,402,948
Edison International................................ 21,800 446,900
Entergy Corp. ...................................... 21,900 595,406
FirstEnergy Corp. .................................. 17,200 402,050
Florida Progress Corp. ............................. 6,300 295,313
FPL Group, Inc. .................................... 12,000 594,000
GPU, Inc. #......................................... 11,900 322,044
New Century Energies, Inc. ......................... 6,800 204,000
Niagara Mohawk Holdings, Inc. *..................... 2,000 27,875
Northern State Power Corp. #........................ 7,700 155,444
PECO Energy Co. .................................... 14,300 576,469
PG&E Corp. ......................................... 27,200 669,800
Pinnacle West Capital Corp. ........................ 6,200 210,025
PPL Corp. .......................................... 11,500 252,281
Public Service Enterprise Group, Inc. .............. 14,900 515,913
</TABLE>
29
<PAGE>
EVERGREEN (formerly,
Equity Index Fund Evergreen
Schedule of Investments (continued) Select
June 30, 2000 Equity Index
Fund)
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
COMMON STOCKS - continued
UTILITIES - continued
Electric Utilities - continued
Reliant Energy, Inc. ............................... 21,000 $ 620,812
Southern Co. ....................................... 46,600 1,086,362
TXU Corp. .......................................... 18,185 536,458
Unicom Corp. ....................................... 16,000 619,000
------------
14,216,975
------------
Gas Utilities - 0.8%
Coastal Corp. ...................................... 14,000 852,250
Columbia Energy Group............................... 5,750 377,344
Eastern Enterprises................................. 3,700 233,100
El Paso Energy Corp. ............................... 16,400 835,375
Enron Corp. ........................................ 51,800 3,341,100
Peoples Energy Corp. ............................... 500 16,188
Sempra Energy....................................... 16,314 277,338
The Williams Companies, Inc. #...................... 28,600 1,192,262
------------
7,124,957
------------
Multi-Utilities - 0.0%
CP & L Energy, Inc. #............................... 9,100 290,631
------------
Total Common Stocks (cost $593,346,855)........... 873,665,900
------------
<CAPTION>
Principal
Amount Value
<S> <C> <C>
U.S. TREASURY OBLIGATIONS - 0.2%
U.S. Government Agency Obligations - 0.2%
U.S. Treasury Bills: +
5.595%, 08/03/2000.................................. $1,000,000 995,182
5.64%, 07/06/2000................................... 20,000 19,991
5.70%, 08/10/2000................................... 635,000 631,179
------------
Total U.S. Treasury Obligations (cost
$1,646,352)...................................... 1,646,352
------------
<CAPTION>
Shares Value
<S> <C> <C>
SHORT TERM INVESTMENTS - 13.4%
MUTUAL FUND SHARES - 11.5%
Navigator Prime Portfolio # # (cost $103,537,931)... 103,537,931 103,537,931
</TABLE>
30
<PAGE>
EVERGREEN (formerly,
Equity Index Fund Evergreen
Schedule of Investments (continued) Select
June 30, 2000 Equity Index
Fund)
<TABLE>
<CAPTION>
Principal
Amount Value
<S> <C> <C>
REPURCHASE AGREEMENT - 1.9%
Dresdner Bank AG
6.40%, dated 6/30/2000, maturing 7/3/2000,
maturity value $16,974,096
(cost $16,965,048) (a)........................... $16,965,048 $ 16,965,048
------------
Total Investments (cost $715,496,186) - 111.0%.................. 995,815,231
Other Assets and Liabilities - net - (11.0)..................... (98,619,909)
------------
Net Assets - 100%............................................... $897,195,322
------------
</TABLE>
See Combined Notes to Schedules of Investments.
31
<PAGE>
EVERGREEN (formerly,
Special Equity Fund Evergreen
Schedule of Investments Select
June 30, 2000 Special
Equity Fund)
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
COMMON STOCKS - 98.4%
CONSUMER DISCRETIONARY - 14.3%
Auto Components - 1.2%
Superior Industries International, Inc. ............. 104,150 $ 2,681,862
Tenneco Automotive, Inc. ............................ 197,850 1,038,713
------------
3,720,575
------------
Distributors - 1.2%
Kent Electronics Corp. .............................. 40,350 1,202,935
SCP Pool Corp. ...................................... 100,692 2,366,250
------------
3,569,185
------------
Hotels, Restaurants & Leisure - 3.4%
Applebee's International, Inc. ...................... 115,520 3,501,700
CEC Entertainment, Inc. *............................ 133,102 3,410,739
Choice Hotels, Inc., REIT *.......................... 238,625 2,371,336
Pinnacle Entertainment, Inc. ........................ 46,300 899,956
------------
10,183,731
------------
Household Durables - 0.3%
Applica, Inc. #...................................... 79,558 900,000
------------
Internet & Catalog Retail - 0.5%
Coldwater Creek, Inc. *.............................. 48,250 1,453,531
------------
Media - 3.9%
Chris Craft Inds., Inc. ............................. 34,150 2,256,034
Emmis Broadcasting Corp., Class A *.................. 34,750 1,437,781
Interpublic Group of Companies, Inc. ................ 34,707 1,492,401
SBS Broadcasting SA * #.............................. 32,160 1,752,720
True North Communications, Inc. ..................... 68,250 3,003,000
VDI Media *.......................................... 285,272 1,996,904
------------
11,938,840
------------
Specialty Retail - 2.4%
Michaels Stores, Inc. * #............................ 82,535 3,781,135
Pacific Sunwear of California * #.................... 114,824 2,152,950
Whitehall Jewelers, Inc. ............................ 71,850 1,338,206
------------
7,272,291
------------
Textiles & Apparel - 1.4%
Guess?, Inc. *....................................... 88,517 1,239,238
Kenneth Cole Productions, Inc., Class A * #.......... 33,079 1,323,160
Wellman, Inc. ....................................... 107,550 1,740,966
------------
4,303,364
------------
CONSUMER STAPLES - 0.7%
Food & Drug Retailing - 0.3%
Fleming Companies, Inc. ............................. 69,250 904,578
------------
</TABLE>
32
<PAGE>
EVERGREEN (formerly,
Special Equity Fund Evergreen
Schedule of Investments (continued) Select
June 30, 2000 Special
Equity Fund)
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
COMMON STOCKS - continued
CONSUMER STAPLES - continued
Household Products - 0.4%
Sola International, Inc. *........................... 247,394 $ 1,206,046
------------
ENERGY - 6.8%
Energy Equipment & Services - 3.7%
Cal Dive International, Inc. *....................... 33,050 1,790,897
Hanover Compressor Co. .............................. 129,250 4,911,500
Nabors Industries, Inc. *............................ 108,062 4,491,327
------------
11,193,724
------------
Oil & Gas - 3.1%
Newfield Exploration Co. *........................... 106,552 4,168,847
St. Mary Land & Exploration Co. *.................... 52,852 2,223,087
Stone Energy Corp. *................................. 49,912 2,982,242
------------
9,374,176
------------
FINANCIALS - 12.2%
Banks - 3.7%
Imperial Bancorp *................................... 278,691 4,337,129
Roslyn Bancorp, Inc. ................................ 204,900 3,403,261
Silicon Valley Bancshares............................ 42,750 1,822,219
Staten Islands Bancorp, Inc. ........................ 93,447 1,647,003
------------
11,209,612
------------
Diversified Financials - 7.3%
Allied Capital Corp. ................................ 63,900 1,086,300
American Capital Strategies, Ltd. ................... 197,850 4,723,669
Dain Rauscher Corp. #................................ 71,603 4,725,798
Eaton Vance Corp. ................................... 38,050 1,759,813
Lancaster Colony Corp. .............................. 71,150 1,365,191
Southwest Securities Group, Inc. #................... 51,926 1,934,243
Triarc Cos, Inc. * #................................. 163,367 3,349,023
WFS Financial, Inc. ................................. 179,690 3,099,652
------------
22,043,689
------------
Insurance - 0.4%
SCPIE Holdings, Inc. ................................ 63,250 1,296,625
------------
Real Estate - 0.8%
LNR Property Corp., REIT............................. 118,966 2,319,837
------------
HEALTH CARE - 10.9%
Biotechnology - 5.4%
Affymetrix, Inc. #................................... 10,550 1,742,069
Corixa Corp. *....................................... 38,250 1,642,359
CuraGen Corp. ....................................... 32,900 1,252,256
Guilford Pharmaceuticals, Inc. * #................... 79,490 1,197,318
</TABLE>
33
<PAGE>
EVERGREEN (formerly,
Special Equity Fund Evergreen
Schedule of Investments (continued) Select
June 30, 2000 Special
Equity Fund)
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
COMMON STOCKS - continued
HEALTH CARE - continued
Biotechnology - continued
Human Genome Sciences, Inc. * #...................... 22,350 $ 2,980,931
ImClone Systems, Inc. ............................... 12,600 963,113
Millennium Pharmaceuticals, Inc. * #................. 22,150 2,478,031
Myriad Genetics, Inc. *.............................. 6,500 962,508
SuperGen, Inc. *..................................... 40,148 1,455,365
Transkaryotic Therapies, Inc. *...................... 45,206 1,661,321
------------
16,335,271
------------
Electronic Equipment & Instruments - 0.6%
Novoste Corp. * #.................................... 32,608 1,989,088
------------
Health Care Equipment & Supplies - 1.7%
ArthroCare Corp. *................................... 24,650 1,312,613
Computer Motion, Inc. * #............................ 162,910 1,344,007
Cytyc Corp. ......................................... 22,250 1,187,594
Haemonetics Corp. ................................... 60,600 1,272,600
------------
5,116,814
------------
Health Care Providers & Services - 1.5%
First Health Group Corp. * #......................... 64,600 2,119,687
Hooper Holmes, Inc. ................................. 290,898 2,327,184
------------
4,446,871
------------
Pharmaceuticals - 1.7%
Dura Pharmaceuticals, Inc. *......................... 137,380 1,974,838
Jones Pharma, Inc. .................................. 47,500 1,897,031
Medicis Pharmaceutical Corp., Class A * #............ 20,900 1,191,300
------------
5,063,169
------------
INDUSTRIALS - 11.5%
Aerospace & Defense - 1.5%
Perkinelmer, Inc. #.................................. 47,700 3,154,162
Titan Corp. #........................................ 33,550 1,501,363
------------
4,655,525
------------
Air Freight & Couriers - 1.2%
Circle International Group, Inc. .................... 140,050 3,518,756
------------
Building Products - 0.5%
Aaon, Inc. *......................................... 65,696 1,609,552
------------
Commercial Services & Supplies - 1.2%
Insurance Auto Auctions, Inc. * #.................... 63,239 1,335,924
Startek, Inc. *...................................... 18,399 926,849
United Stationers, Inc. ............................. 42,400 1,372,700
------------
3,635,473
------------
</TABLE>
34
<PAGE>
EVERGREEN (formerly,
Special Equity Fund Evergreen
Schedule of Investments (continued) Select
June 30, 2000 Special
Equity Fund)
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
COMMON STOCKS - continued
INDUSTRIALS - continued
Electrical Equipment - 1.0%
American Superconductor Corp. ....................... 38,740 $ 1,869,205
Cable Design Technologies Corp. *.................... 34,450 1,154,075
------------
3,023,280
------------
Industrial Conglomerates - 0.6%
Pentair, Inc. ....................................... 47,410 1,683,055
------------
Machinery - 1.7%
AGCO Corp. .......................................... 99,300 1,216,425
Maverick Tube Corp. *................................ 42,919 1,250,016
Shaw Group, Inc. *................................... 53,690 2,530,141
------------
4,996,582
------------
Marine - 0.3%
Overseas Shipholding Group, Inc. .................... 39,750 978,844
------------
Road & Rail - 3.5%
American Freightways Corp. *......................... 77,343 1,121,474
Arkansas Best Corp. *................................ 284,450 2,826,722
Forward Air Corp. ................................... 49,953 1,998,120
Genesee & Wyoming, Inc. *............................ 119,130 1,995,427
Roadway Express, Inc. #.............................. 111,629 2,616,305
------------
10,558,048
------------
INFORMATION TECHNOLOGY - 27.5%
Communications Equipment - 3.7%
Advanced Fibre Communications, Inc. *................ 39,050 1,769,453
Allen Telecom, Inc. ................................. 81,614 1,443,548
C-COR.net Corp. * #.................................. 76,224 2,058,048
Emulex Corp. ........................................ 23,850 1,566,647
Harmonic Lightwaves, Inc. * #........................ 12,075 298,856
Natural Microsystems Corp. *......................... 20,550 2,310,591
Netro Corp. ......................................... 30,700 1,761,412
------------
11,208,555
------------
Computers & Peripherals - 1.3%
Pinnacle Systems, Inc. *............................. 86,980 1,955,691
Radisys Corp. * #.................................... 36,141 2,051,002
------------
4,006,693
------------
Electrical Equipment - 1.1%
Anaren Microwave, Inc. * #........................... 25,901 3,399,102
------------
Electronic Equipment & Instruments - 4.5%
Amkor Technology, Inc. #............................. 34,500 1,218,281
Amphenol Corp. ...................................... 28,300 1,873,106
Cree Research, Inc. *................................ 10,500 1,401,750
II-VI, Inc. *........................................ 39,749 1,922,858
</TABLE>
35
<PAGE>
EVERGREEN (formerly,
Special Equity Fund Evergreen
Schedule of Investments (continued) Select
June 30, 2000 Special
Equity Fund)
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
COMMON STOCKS - continued
INFORMATION TECHNOLOGY - continued
Electronic Equipment & Instruments - continued
Kemet Corp. *........................................ 48,150 $ 1,206,759
Kopin Corp. *........................................ 17,150 1,187,638
Macrovision Corp. ................................... 21,700 1,387,105
Mettler Toledo International, Inc. .................. 39,650 1,586,000
Three-Five Systems, Inc. *........................... 29,065 1,714,835
------------
13,498,332
------------
Internet Software & Services - 1.1%
Broadvision, Inc. *.................................. 41,300 2,098,556
Digital Islands, Inc. #.............................. 21,550 1,047,869
------------
3,146,425
------------
Semiconductor Equipment & Products - 10.5%
ANADIGICS, Inc. *.................................... 40,275 1,371,867
Applied Science & Tech, Inc. *....................... 57,872 1,497,438
Credence Systems Corp. .............................. 22,100 1,219,644
Cypress Semiconductor Corp. *........................ 66,100 2,792,725
Elantec Semiconductor, Inc. *........................ 23,350 1,625,744
Gasonics International Corp. *....................... 57,690 2,275,149
Helix Technology Corp. .............................. 74,251 2,895,789
Integrated Device Technology......................... 53,050 3,176,369
International Rectifier Corp. *...................... 37,150 2,080,400
Lam Research Corp. *................................. 55,700 2,088,750
LTX Corp. *.......................................... 79,095 2,763,382
Mattson Technology, Inc. * #......................... 61,380 1,994,850
Photon Dynamics, Inc. *.............................. 19,314 1,442,514
S3, Inc. *........................................... 86,458 1,275,255
Semtech Corp. #...................................... 22,650 1,732,371
Triquint Semiconductor, Inc. ........................ 14,950 1,430,528
------------
31,662,775
------------
Software - 5.3%
Aspect Communications, Inc . #....................... 30,700 1,206,894
Documentum, Inc. *................................... 18,100 1,617,688
I2 Technologies, Inc. *.............................. 15,412 1,606,942
Mercury Interactive Corp. *.......................... 41,450 4,010,287
Peregrine Systems, Inc. *............................ 159,650 5,537,859
Tecnomatix Technologies, Ltd. *...................... 72,408 986,559
Wind River Systems, Inc. * #......................... 30,750 1,164,656
------------
16,130,885
------------
MATERIALS - 7.6%
Chemicals - 3.2%
Chirex, Inc. *....................................... 54,420 1,088,400
Georgia Gulf Corp. #................................. 69,700 1,450,631
</TABLE>
36
<PAGE>
EVERGREEN (formerly,
Special Equity Fund Evergreen
Schedule of Investments (continued) Select
June 30, 2000 Special
Equity Fund)
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
COMMON STOCKS - continued
MATERIALS - continued
Chemicals - continued
Lubrizol Corp. ....................................... 108,750 $ 2,283,750
Material Sciences Corp. *............................. 104,500 1,045,000
Olin Corp. ........................................... 152,700 2,519,550
Spartech Corp. ....................................... 47,450 1,281,150
------------
9,668,481
------------
Construction Materials - 1.0%
Elcor Chemical Corp. ................................. 52,350 1,204,050
Texas Industries, Inc. ............................... 59,450 1,716,619
------------
2,920,669
------------
Metals & Mining - 2.3%
Commercial Metals Co. ................................ 99,800 2,744,500
Freeport McMoran Copper & Gold, Inc., Class B *....... 155,950 1,442,538
Lone Star Technologies, Inc. * #...................... 58,960 2,726,900
------------
6,913,938
------------
Paper & Forest Products - 1.1%
Glatfelter P. H. Co. ................................. 129,100 1,315,206
Pope & Talbot, Inc. .................................. 132,842 2,125,472
------------
3,440,678
------------
TELECOMMUNICATION SERVICES - 1.6%
Diversified Telecommunication Services - 1.6%
NEXTLINK Communications, Inc., Class A * #............ 49,470 1,876,768
Powertel, Inc. ....................................... 21,650 1,535,797
US LEC Corp., Class A *............................... 82,800 1,407,600
------------
4,820,165
------------
UTILITIES - 5.3%
Electric Utilities - 1.6%
Bangor Hydro Electric Co. ............................ 76,750 1,798,828
CMP Group, Inc........................................ 48,950 1,434,847
El Paso Electric Co. #................................ 141,350 1,581,353
------------
4,815,028
------------
Gas Utilities - 3.3%
CTG Resources, Inc. .................................. 29,300 1,074,944
Equitable Resources, Inc.............................. 36,850 1,778,012
MCN Energy Group, Inc. ............................... 106,000 2,265,750
New Jersey Resources Corp. ........................... 75,150 2,860,397
Western Gas Resources, Inc. .......................... 94,160 1,977,360
------------
9,956,463
------------
Water Utilities - 0.4%
Etown Corp............................................ 17,000 1,129,437
------------
Total Common Stocks (cost $269,454,909)............. 297,217,758
------------
</TABLE>
37
<PAGE>
EVERGREEN (formerly,
Special Equity Fund Evergreen
Schedule of Investments(continued) Select
June 30, 2000 Special
Equity Fund)
<TABLE>
<CAPTION>
Shares Value
<S> <C> <C>
SHORT TERM INVESTMENTS - 14.0%
MUTUAL FUND SHARES - 12.3%
Navigator Prime Portfolio ##
(cost $37,303,525)................................. 37,303,525 $ 37,303,525
<CAPTION>
Principal
Amount Value
<S> <C> <C>
REPURCHASE AGREEMENT - 1.7%
Dresdner Bank AG
6.40%, dated 6/30/2000, maturing 7/3/2000, maturity
value $4,995,372
(cost $4,992,709) (b).............................. $4,992,709 4,992,709
------------
Total Investments - (cost $311,751,143) - 112.4%................. 339,513,992
Other Assets and Liabilities - net - (12.4)...................... (37,475,845)
------------
Net Assets - 100.0%.............................................. $302,038,147
------------
</TABLE>
See Combined Notes to Schedules of Investments.
38
<PAGE>
EVERGREEN
Equity Funds
Combined Notes to Schedules of Investments
June 30, 2000
(a) The repurchase agreement is fully collateralized by $17,420,000 U.S.
Treasury Notes, 5.25% 05/31/2001, value including accrued interest
$17,494,963.
(b) The repurchase agreement is fully collateralized by $5,130,000 U.S.
Treasury Notes, 5.25% 05/31/2001, value including accrued interest
$5,152,076.
+ Securities are being held in a segregated account at the Fund's custodian
for initial margin deposits on open future contracts.
# All or a portion of this security is on loan.
## Represents investment in cash collateral received for securities on loan.
* Non-income producing security.
** At June 30, 2000, the Fund owned 68,960 shares of First Union Corp. common
stock, an affiliated issuer, with a cost of $3,081,788. During the period
ended June 30, 2000, the Fund earned $127,405 in dividend income from this
investment. This investment in First Union Corp. enables the Fund to
maintain a similar weighting as that of the S&P 500 Index.
Summary of Abbreviations:
REIT Real Estate Investment Trust
See Combined Notes to Financial Statements.
39
<PAGE>
EVERGREEN
Equity Funds
Statements of Assets and Liabilities
June 30, 2000
<TABLE>
<CAPTION>
Equity Index Special Equity
Fund Fund
--------------------------------------------------------------------------------
<S> <C> <C>
Assets
Identified cost of securities.................. $ 715,496,186 $311,751,143
Net unrealized gains on securities............. 280,319,045 27,762,849
--------------------------------------------------------------------------------
Market value of securities..................... 995,815,231 339,513,992
Receivable for securities sold................. 523,321 157,344
Receivable for Fund shares sold................ 5,547,007 2,165,047
Dividends and interest receivable.............. 676,727 73,427
Receivable for daily variation margin on open
futures contracts............................. 123,725 0
Receivable from investment advisor............. 342,078 60,088
Prepaid expenses and other assets.............. 20,632 20,567
--------------------------------------------------------------------------------
Total assets................................... 1,003,048,721 341,990,465
--------------------------------------------------------------------------------
Liabilities
Distributions payable.......................... 95,201 0
Payable for securities purchased............... 489,737 1,835,737
Payable for Fund shares redeemed............... 1,602,275 752,877
Payable for securities on loan................. 103,537,931 37,303,525
Due to custodian bank.......................... 0 2,647
Distribution Plan expenses payable............. 22,982 6,262
Due to other related parties................... 7,272 2,472
Accrued expenses and other liabilities......... 98,001 48,798
--------------------------------------------------------------------------------
Total liabilities.............................. 105,853,399 39,952,318
--------------------------------------------------------------------------------
Net assets...................................... $ 897,195,322 $302,038,147
--------------------------------------------------------------------------------
Net assets represented by
Paid-in capital................................ $ 622,569,874 $252,177,740
Undistributed (overdistributed) net investment
income (loss)................................. (26,320) (1,700)
Accumulated net realized gains or losses on
securities and futures contracts.............. (5,372,709) 22,099,258
Net unrealized gains on securities and futures
contracts..................................... 280,024,477 27,762,849
--------------------------------------------------------------------------------
Total net assets................................ $ 897,195,322 $302,038,147
--------------------------------------------------------------------------------
Net assets consists of
Class I........................................ $ 539,804,345 $192,145,792
Class IS....................................... 18,708,286 7,834,580
Class A........................................ 79,991,434 35,390,203
Class B........................................ 203,984,288 40,898,164
Class C........................................ 54,706,969 25,769,408
--------------------------------------------------------------------------------
Total net assets................................ $ 897,195,322 $302,038,147
--------------------------------------------------------------------------------
Shares outstanding
Class I........................................ 9,859,759 12,069,823
Class IS....................................... 341,845 499,137
Class A........................................ 1,461,513 2,258,139
Class B........................................ 3,734,838 2,623,563
Class C........................................ 1,000,235 1,652,573
--------------------------------------------------------------------------------
Net asset value per share
Class I........................................ $ 54.75 $ 15.92
--------------------------------------------------------------------------------
Class IS....................................... $ 54.73 $ 15.70
--------------------------------------------------------------------------------
Class A........................................ $ 54.73 $ 15.67
--------------------------------------------------------------------------------
Class A--Offering price (based on sales charge
of 4.75%)..................................... $ 57.46 $ 16.45
--------------------------------------------------------------------------------
Class B........................................ $ 54.62 $ 15.59
--------------------------------------------------------------------------------
Class C........................................ $ 54.69 $ 15.59
--------------------------------------------------------------------------------
</TABLE>
See Combined Notes to Financial Statements.
40
<PAGE>
EVERGREEN
Equity Funds
Statements of Operations
Year Ended June 30, 2000
<TABLE>
<CAPTION>
Equity Index Special Equity
Fund Fund
---------------------------------------------------------------------------------
<S> <C> <C>
Investment income
Dividends (net of foreign withholding taxes of
$21,367 and $0, respectively).................... $ 9,554,982 $ 825,828
Interest.......................................... 1,543,093 594,488
---------------------------------------------------------------------------------
Total investment income............................ 11,098,075 1,420,316
---------------------------------------------------------------------------------
Expenses
Advisory fee...................................... 2,984,990 2,123,588
Distribution Plan expenses........................ 2,108,008 312,561
Administrative services fees...................... 554,317 167,147
Transfer agent fee................................ 1,002,958 162,514
Trustees' fees and expenses....................... 16,554 6,638
Printing and postage expenses..................... 61,351 24,134
Custodian fee..................................... 211,064 49,461
Registration and filing fees...................... 66,555 107,382
Professional fees................................. 31,784 24,963
Other............................................. 6,035 4,892
---------------------------------------------------------------------------------
Total expenses.................................. 7,043,616 2,983,280
Less: Expense reductions........................ (30,146) (19,713)
Fee waivers............................... (2,403,203) (508,842)
---------------------------------------------------------------------------------
Net expenses.................................... 4,610,267 2,454,725
---------------------------------------------------------------------------------
Net investment income (loss)...................... 6,487,808 (1,034,409)
---------------------------------------------------------------------------------
Net realized and unrealized gains or losses on
securities and futures contracts
Net realized gains or losses on:
Securities...................................... (4,695,415) 38,326,333
Futures contracts............................... 2,135,170 0
---------------------------------------------------------------------------------
Net realized gains or losses on securities and
futures contracts................................ (2,560,245) 38,326,333
---------------------------------------------------------------------------------
Net change in unrealized gains on securities and
futures contracts................................ 51,274,071 7,296,365
---------------------------------------------------------------------------------
Net realized and unrealized gains on securities
and futures contracts............................ 48,713,826 45,622,698
---------------------------------------------------------------------------------
Net increase in net assets resulting from
operations....................................... $55,201,634 $44,588,289
---------------------------------------------------------------------------------
</TABLE>
See Combined Notes to Financial Statements.
41
<PAGE>
EVERGREEN
Equity Funds
Statements of Changes in Net Assets
Year Ended June 30, 2000
<TABLE>
<CAPTION>
Equity Index Special Equity
Fund Fund
-------------------------------------------------------------------------------
<S> <C> <C>
Operations
Net investment income (loss).................... $ 6,487,808 $ (1,034,409)
Net realized gains or losses on securities and
futures contracts.............................. (2,560,245) 38,326,333
Net change in unrealized gains on securities and
futures contracts.............................. 51,274,071 7,296,365
-------------------------------------------------------------------------------
Net increase in net assets resulting from
operations................................... 55,201,634 44,588,289
-------------------------------------------------------------------------------
Distributions to shareholders from
Net investment income
Class I....................................... (5,942,202) 0
Class IS...................................... (238,272) 0
Class A....................................... (482,496) 0
Class B....................................... (303,501) 0
Class C....................................... (40,926) 0
Net realized gains
Class I....................................... (3,855,784) (21,494,234)
Class IS...................................... (264,381) (856,226)
Class A....................................... (358,623) (503,264)
Class B....................................... (1,092,585) (545,776)
Class C....................................... (131,127) (362,155)
-------------------------------------------------------------------------------
Total distributions to shareholders........... (12,709,897) (23,761,655)
-------------------------------------------------------------------------------
Capital share transactions
Proceeds from shares sold....................... 447,773,097 221,703,992
Payment for shares redeemed..................... (362,770,305) (80,061,050)
Net asset value of shares issued in reinvestment
of distributions............................... 11,758,653 18,559,619
-------------------------------------------------------------------------------
Net increase in net assets resulting from
capital share transactions................... 96,761,445 160,202,561
-------------------------------------------------------------------------------
Total increase in net assets................ 139,253,182 181,029,195
Net assets
Beginning of period............................. 757,942,140 121,008,952
-------------------------------------------------------------------------------
End of period................................... $897,195,322 $302,038,147
-------------------------------------------------------------------------------
Underdistributed (overdistributed) net investment
income (loss)................................... $ (26,320) $ (1,700)
-------------------------------------------------------------------------------
</TABLE>
See Combined Notes to Financial Statements.
42
<PAGE>
EVERGREEN
Equity Funds
Statements of Changes in Net Assets
Year Ended June 30, 1999
<TABLE>
<CAPTION>
Equity Index Special Equity
Fund Fund
-------------------------------------------------------------------------------
<S> <C> <C>
Operations
Net investment income or loss................... $ 5,015,981 $ (293,653)
Net realized gains on securities and futures
contracts...................................... 19,118,855 17,426,693
Net change in unrealized gains on securities and
futures contracts.............................. 69,198,431 14,600,653
-------------------------------------------------------------------------------
Net increase in net assets resulting from
operations................................... 93,333,267 31,733,693
-------------------------------------------------------------------------------
Distributions to shareholders from
Net investment income
Class I....................................... (4,162,159) 0
Class IS...................................... (242,056) 0
Class A....................................... (80,573) 0
Class B....................................... (52,475) 0
Class C....................................... (692) 0
Net realized gains
Class I....................................... (17,615,538) (7,643,649)
Class IS...................................... (2,041,449) (298,735)
Class A....................................... (10,507) 0
Class B....................................... (32,427) 0
-------------------------------------------------------------------------------
Total distributions to shareholders........... (24,237,876) (7,942,384)
-------------------------------------------------------------------------------
Capital share transactions
Proceeds from shares sold....................... 473,037,440 44,330,181
Payment for shares redeemed..................... (136,826,407) (32,256,122)
Net asset value of shares issued in reinvestment
of distributions............................... 22,881,422 7,935,176
-------------------------------------------------------------------------------
Net increase in net assets resulting from
capital share transactions................... 359,092,455 20,009,235
-------------------------------------------------------------------------------
Total increase in net assets................ 428,187,846 43,800,544
Net assets
Beginning of period............................. 329,754,294 77,208,408
-------------------------------------------------------------------------------
End of period................................... $757,942,140 $121,008,952
-------------------------------------------------------------------------------
Undistributed (overdistributed) net investment
income (loss)................................... $ 506,359 $ (322)
-------------------------------------------------------------------------------
</TABLE>
See Combined Notes to Financial Statements.
43
<PAGE>
EVERGREEN
Equity Funds
Combined Notes to Financial Statements
1. ORGANIZATION
The Evergreen Equity Funds consist of Evergreen Equity Index Fund ("Equity In-
dex Fund") (formerly, Select Equity Index Fund) and Evergreen Special Equity
Fund ("Special Equity Fund") (formerly, Select Special Equity Fund), (collec-
tively, the "Funds"). Each Fund is a diversified series of Evergreen Select Eq-
uity Trust (the "Trust"), a Delaware business trust organized on September 18,
1997. The Trust is an open-end management investment company registered under
the Investment Company Act of 1940, as amended (the "1940 Act").
The Funds offer Class A, Class B, Class C, Institutional shares ("Class I") and
Institutional Service shares ("Class IS"). Class A shares are sold with a maxi-
mum front-end sales charge of 4.75%. Class B and Class C shares are sold with-
out a front-end sales charge, but pay a higher ongoing distribution fee than
Class A. Class B shares are sold subject to a contingent deferred sales charge
that is payable upon redemption and decreases depending on how long the shares
have been held. Class B shares purchased after January 1, 1997 will automati-
cally convert to Class A shares after seven years. Class B shares purchased
prior to January 1, 1997 follow the conversion rights at the time the shares
were initially purchased. Class C shares are sold subject to a 2.00% contingent
deferred sales charge payable on shares redeemed within one year after the
month of purchase and a 1.00% contingent deferred sales charge if such shares
are redeemed within two years after the month of purchase. Class C shares pur-
chased prior to February 1, 2000 follow the contingent deferred sales charge
schedule at the time the shares were initially purchased. Class I and Class IS
shares are sold without a front-end sales charge or contingent deferred sales
charge. Class IS shares pay an ongoing service fee. Class I and Class IS shares
are sold only to certain institutional shareholders.
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") and other securities traded in the over-the-
counter market are valued at the last reported sales price on the exchange
where the security is 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. Securities for which market quotations are not readily available, in-
cluding restricted securities, are valued at fair value as determined in good
faith according to procedures approved by the Board of Trustees.
Mutual fund shares held in a Fund are valued at the net asset value of each mu-
tual fund.
Short-term investments with remaining maturities of 60 days or less 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 in a segregated account by the custodian on
the Fund's behalf. Collateral 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 collat-
eral 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 advisor to be creditworthy pursuant to
guidelines established by the Board of Trustees.
44
<PAGE>
Combined Notes to Financial Statements (continued)
Pursuant to an exemptive order issued by the Securities and Exchange Commis-
sion, the Funds may transfer uninvested cash balances into a joint trading ac-
count. 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 and income and expenses at the
rate of exchange prevailing on the respective dates of such transactions. Net
unrealized foreign exchange gains or losses resulting from changes in foreign
currency exchange rates is a component of net unrealized gains or losses on se-
curities and foreign currency related transactions. Net realized foreign cur-
rency gain or loss on foreign currency related transactions includes foreign
currency gains and losses between trade date and settlement date on investment
securities transactions, foreign currency related transactions and the differ-
ence between the amounts of interest and dividends recorded on the books of the
Fund and the amount actually received. 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 gain or loss
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 qualified financial organizations.
The Funds' investment adviser will monitor the creditworthiness of such borrow-
ers. 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 bor-
rower 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 se-
curities 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 obtain 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 con-
nection 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 the 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 in the case of some foreign securities, on the date there-
after when the Fund is made aware of the dividend. Foreign income and capital
gains realized on some foreign securities may be subject to foreign taxes,
which are accrued as applicable.
45
<PAGE>
Combined Notes to Financial Statements (continued)
G. Federal Taxes
The Funds have qualified and intend to continue to qualify as regulated invest-
ment companies under the Internal Revenue Code of 1986, as amended (the
"Code"). Thus, the Funds will not incur any federal income tax liability since
they are expected to distribute all of their net investment company taxable in-
come and net capital gains, if any, to their shareholders. The Funds also in-
tend to avoid any excise tax liability by making the required distributions un-
der the Code. Accordingly, no provision for federal taxes is required.
H. Distributions
Distributions from net investment income for the Funds are declared and paid
monthly. Distributions from net realized capital gains, if any, are paid at
least annually. To the extent that realized capital gains can be offset by cap-
ital loss carryforwards, it is each Fund's policy not to distribute such gains.
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. Reclassifications have been made to the Funds' components
of net assets to reflect income and gains available for distribution (or avail-
able capital loss carryovers, as applicable) under income tax regulations. The
primary permanent differences causing such reclassifications are due to net op-
erating losses. Earnings and profits distributed to shareholders on redemption
of shares was utilized as part of the dividends paid deduction for income tax
purposes.
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 for each class except, Class
I.
3. INVESTMENT ADVISORY AGREEMENTS AND OTHER AFFILIATED TRANSACTIONS
First Union National Bank ("FUNB"), a subsidiary of First Union Corporation
("First Union"), is the investment advisor to the Equity Index Fund and is paid
a management fee that is computed and paid daily at an annual rate of 0.32% of
the Fund's average daily net assets. Prior to January 3, 2000 the Fund paid
FUNB a fee at the annual rate of 0.40% of the Fund's average daily net assets.
Meridian Investment Company ("MIC"), an indirect, wholly owned subsidiary of
First Union, serves as the investment advisor to the Special Equity Fund. In
return for its services, MIC is paid an annual fee equal to .90% of average
daily net assets of the Fund. Prior to January 3, 2000 the Fund paid MIC a fee
at the annual rate of 1.00% of the Fund's average daily net assets.
During the year ended June 30, 2000, the amount of investment advisory fees
waived or expenses reimbursed by the investment advisors and the impact on each
Fund's annualized expense ratio represented as a percentage of its average net
assets were as follows:
<TABLE>
<CAPTION>
Fees % of Average
Waived Net Assets
-----------------------
<S> <C> <C>
Equity Index Fund............. $2,403,203 0.29%
Special Equity Fund........... 508,842 0.24%
</TABLE>
Evergreen Investment Services ("EIS"), an indirect, wholly owned subsidiary of
FUNB, is the administrator to the Funds. As administrator, EIS provides the
Funds with facilities, equipment and personnel. Prior to May 1, 2000, The BISYS
Group, Inc. ("BISYS") served as the sub-administrator to the Funds and provided
the officers of the Funds. Officers of the Funds and affiliated Trustees re-
ceive no compensation directly from the Funds.
For its services, the Funds pay the administrator a fee at the annual rate of
0.10% of each Fund's average daily net assets. The sub-administrator was paid
by the administrator out of its fees until the sub-administration agreement
with BISYS was terminated on April 30, 2000. Prior to January 3, 2000, the ad-
ministrator and sub-administrator for the Funds were entitled to an annual fee
based on the combined average daily net assets of all the funds administered by
EIS for which First Union or its investment advisory subsidiaries are also the
46
<PAGE>
Combined Notes to Financial Statements (continued)
investment advisors. The administration fee was calculated by applying percent-
age rates, which started at 0.05% and declined to 0.01% per annum as net assets
increased, to the average daily net assets of each Fund. The sub-administration
fee was calculated by applying percentage rates, which started at 0.01% and de-
clined to 0.004% per annum as net assets increased, to the average daily net
assets of each Fund.
During the year ended June 30, 2000, the Funds paid or accrued to EIS the fol-
lowing amounts for administrative and sub-administrative services:
<TABLE>
<CAPTION>
Administration Sub-Administration
Fee Fee
---------------------------------
<S> <C> <C>
Equity Index Fund... $527,051 $27,266
Special Equity
Fund............... 161,330 5,817
</TABLE>
Evergreen Service Company ("ESC"), an indirect, wholly owned subsidiary of
FUNB, is the transfer and dividend disbursing agent for the Funds.
4. DISTRIBUTION PLANS
Evergreen Distributor, Inc. ("EDI"), a wholly owned subsidiary of BISYS, serves
as principal underwriter to the Funds.
Each Fund has adopted Distribution Plans, as allowed by Rule 12b-1 of the 1940
Act, for each class of shares, except Class I. Distribution plans permit a Fund
to compensate 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-dealers who sell shares of the Fund,
are paid by the Fund through "Distribution Plan expenses". Under the Distribu-
tion Plans, Class A and Class IS incur distributions fees equal to 0.25% of the
average daily net asset of the class, all of which is used to pay for share-
holder service fees. Class B and Class C incur distribution fees equal to 1.00%
of the average daily net assets of each class. Of this amount, 0.25% is used to
pay for shareholder service fees and 0.75% is used to pay for distribution-
related costs. Distribution Plan expenses are calculated and paid daily.
During the year ended June 30, 2000, amounts paid or accrued to EDI pursuant to
each Fund's Class A, Class B, Class C and Class IS Distribution Plans were as
follows:
<TABLE>
<CAPTION>
Class
Class A Class B Class C IS
------------------------------------
<S> <C> <C> <C> <C>
Equity Index Fund........ $147,211 $1,634,402 $255,137 $71,258
Special Equity Fund...... 36,871 154,987 104,008 16,695
</TABLE>
With respect to Class B and Class C shares, the principal underwriter may pay
distribution fees greater than the allowable annual amounts each Fund is per-
mitted to pay under the Distribution Plans.
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. ACQUISITIONS
Effective on the close of business on July 24, 1998, Equity Index Fund and Spe-
cial Equity Fund acquired all of the net assets and certain liabilities of the
CoreFund Equity Index Fund ("Core Equity Index Fund") and CoreFund Special Eq-
uity Fund ("Core Special Equity Fund") (collectively, "CoreFunds"), respective-
ly, each an open-end, management investment company, registered under 1940 Act,
through an exchange of shares. Shareholders of Class A, Class B and Class Y
shares of the CoreFunds became owners of that number of full and fractional
shares of Class IS, Class IS and Class I shares, respectively, of Equity Index
Fund and Special Equity Fund, having an aggregate net asset value equal to the
aggregate net asset value of their CoreFund shares immediately prior to the
close of business on July 24, 1998.
The Funds had no operations prior to the acquisition. Since the Funds and the
Core Funds were similar funds, and the CoreFunds contributed the majority of
the net assets and shareholders, their basis of accounting for assets and lia-
bilities and their operating results for prior periods are carried forward as
the accounting survivors. CoreFunds Class A and Class Y shares were the prede-
cessor share classes to the Fund Class IS and
47
<PAGE>
Combined Notes to Financial Statements (continued)
Class I. As a result of these transactions, shareholders of Core Equity Index
Fund, Class B received 43,220 shares of Equity Index Fund, Class IS and share-
holders of Core Special Equity Fund, Class B received 22,353 shares of Special
Equity Fund, Class IS.
6. 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, Class IS, Class A, Class B, and Class C Transactions in
shares of the Funds were as follows:
Equity Index Fund
<TABLE>
<CAPTION>
Year Ended Year Ended
June 30, 2000 June 30, 1999*
------------------------- -------------------------
Shares Amount Shares Amount
-------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class I Shares
Shares sold............. 3,854,353 $ 197,217,512 6,042,846 $ 285,769,694
Shares redeemed......... (5,130,778) (266,953,367) (2,377,803) (106,433,062)
Shares issued in
reinvestment of
distributions.......... 170,171 9,000,233 473,952 20,448,200
-------------------------------------------------------------------------------
Net increase
(decrease)............. (1,106,254) (60,735,622) 4,138,995 199,784,832
-------------------------------------------------------------------------------
Class IS Shares
Shares sold............. 109,070 5,755,898 442,280 20,862,310
Shares redeemed......... (507,648) (24,104,029) (65,194) (6,348,972)
Shares issued in
reinvestment of
distributions.......... 9,263 488,264 52,714 2,258,939
Shares issued in
acquisition of CoreFund
Class B Shares......... -- -- 43,220 2,010,366
-------------------------------------------------------------------------------
Net increase
(decrease)............. (389,315) (17,859,867) 473,020 18,782,643
-------------------------------------------------------------------------------
Class A Shares
Shares sold............. 1,367,393 74,486,727 1,148,902 56,545,137
Automatic conversion of
Class B Shares to Class
A Shares............... 48,779 2,691,257
Shares redeemed......... (704,342) (36,432,072) (416,523) (20,942,814)
Shares issued in
reinvestment of
distributions.......... 15,426 817,672 1,878 90,280
-------------------------------------------------------------------------------
Net increase............ 727,256 41,563,584 734,257 35,692,603
-------------------------------------------------------------------------------
Class B Shares
Shares sold............. 2,236,084 117,048,528 2,124,978 104,464,062
Automatic conversion of
Class B Shares to Class
A Shares............... (48,779) (2,691,257)
Shares redeemed......... (541,534) (31,226,942) (62,624) (3,100,383)
Shares issued in
reinvestment of
distributions.......... 24,901 1,314,284 1,812 83,415
-------------------------------------------------------------------------------
Net increase............ 1,670,672 84,444,613 2,064,166 101,447,094
-------------------------------------------------------------------------------
Class C Shares
Shares sold............. 1,006,631 53,264,432 67,034 3,385,871
Shares redeemed......... (76,030) (4,053,895) (23) (1,176)
Shares issued in
reinvestment of
distributions.......... 2,611 138,200 12 588
-------------------------------------------------------------------------------
Net increase............ 933,212 49,348,737 67,023 3,385,283
-------------------------------------------------------------------------------
Net increase............ $ 96,761,445 $ 359,092,455
-------------------------------------------------------------------------------
</TABLE>
* For the Class A, Class B and Class C periods from November 4, 1998, November
3, 1998 and April 30, 1999 (commencement of class operations) respectively,
to June 30, 1999.
48
<PAGE>
Combined Notes to Financial Statements (continued)
Special Equity Fund
<TABLE>
<CAPTION>
Year Ended Year Ended
June 30, 2000 June 30, 1999
------------------------ -----------------------
Shares Amount Shares Amount
------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class I Shares
Shares sold................ 7,415,812 $110,268,925 3,681,321 $43,045,845
Shares redeemed............ (4,802,221) (67,884,385) (2,831,875) (30,671,560)
Shares issued in
reinvestment of
distributions............. 1,218,885 16,635,987 812,275 7,643,511
------------------------------------------------------------------------------
Net increase............... 3,832,476 59,020,527 1,661,721 20,017,796
------------------------------------------------------------------------------
Class IS Shares
Shares sold................ 441,785 6,632,358 114,558 1,284,336
Shares redeemed............ (284,897) (4,239,421) (146,994) (1,584,562)
Shares issued in
reinvestment of
distributions............. 54,558 730,361 31,295 291,665
------------------------------------------------------------------------------
Net increase (decrease).... 211,446 3,123,298 (1,141) (8,561)
------------------------------------------------------------------------------
Class A Shares*
Shares sold................ 2,421,917 36,355,067 -- --
Shares redeemed............ (193,031) (2,960,193) -- --
Shares issued in
reinvestment of
distributions............. 29,253 425,298 -- --
------------------------------------------------------------------------------
Net increase............... 2,258,139 33,820,172 -- --
------------------------------------------------------------------------------
Class B Shares*
Shares sold................ 2,803,081 42,066,143 -- --
Shares redeemed............ (211,463) (3,238,744) -- --
Shares issued in
reinvestment of
distributions............. 31,945 461,238 -- --
------------------------------------------------------------------------------
Net increase............... 2,623,563 39,288,637 -- --
------------------------------------------------------------------------------
Class C Shares*
Shares sold................ 1,743,304 26,381,499 -- --
Shares redeemed............ (111,965) (1,738,307) -- --
Shares issued in
reinvestment of
distributions............. 21,234 306,735 -- --
------------------------------------------------------------------------------
Net increase............... 1,652,573 24,949,927 -- --
------------------------------------------------------------------------------
Net increase............... $160,202,561 -- $20,009,235
------------------------------------------------------------------------------
</TABLE>
* For the period from August 30, 1999 (commencement of class operations) to
June 30, 2000.
7. SECURITIES TRANSACTIONS
Cost of purchases and proceeds from sales of investment securities (excluding
short-term securities) were as follows for the year ended June 30, 2000:
<TABLE>
<CAPTION>
Cost of Proceeds
Purchases from Sales
------------------------
<S> <C> <C>
Equity Index Fund............ $193,073,869 $97,163,202
Special Equity Fund.......... 465,698,755 329,465,299
</TABLE>
At June 30, 2000, the Equity Index Fund had open futures contracts outstanding
as follows:
<TABLE>
<CAPTION>
Initial
Contract Value at Unrealized
Expiration Contracts Amount June 30, 2000 Loss
----------------------------------------------------------------------
<S> <C> <C> <C> <C>
September 2000 49 S&P 500 $18,278,793 $17,984,225 $294,568
</TABLE>
Each Fund loaned securities during the period ended June 30, 2000 to certain
brokers who paid the Fund a negotiated lenders' fee. These fees are included in
interest income. For the Equity Index Fund, the value of securities on loan and
the value of collateral (including accrued interest) amounted to $101,271,728
and $103,537,931, respectively. For the Special Equity Fund, the value of secu-
rities on loan and the value of collateral (including accrued interest)
amounted to $36,647,049 and $37,303,525, respectively.
On June 30, 2000 the composition of unrealized appreciation and depreciation on
securities based on the aggregate cost of securities for federal income tax
purposes were as follows:
<TABLE>
<CAPTION>
Gross Gross Net
Unrealized Unrealized Unrealized
Tax Cost Appreciation Depreciation Appreciation
---------------------------------------------------
<S> <C> <C> <C> <C>
Equity Index
Fund............. $720,581,711 $316,325,613 $41,092,093 $275,233,520
Special Equity
Fund............. 313,762,611 44,636,409 18,885,028 25,751,381
</TABLE>
49
<PAGE>
Combined Notes to Financial Statements (continued)
As of June 30, 2000, Equity Index Fund had a capital loss carryover of $581,752
which expires on 6/30/2008.
8. EXPENSE REDUCTIONS
The Funds have entered into expense offset arrangements with ESC and their cus-
todian whereby credits realized as a result of uninvested cash balances were
used to reduce a portion of each Fund's related expenses. The assets deposited
with ESC and the custodian under these expense offset arrangements could have
been invested in income-producing assets.
<TABLE>
<CAPTION>
Expense % of Average
Reductions Net Assets
-----------------------
<S> <C> <C>
Equity Index Fund...................... $30,146 0.00%
Special Equity Fund.................... 19,713 0.00%
</TABLE>
9. DEFERRED TRUSTEES' FEES
Each Independent Trustee of each Fund 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.
10. FINANCING AGREEMENTS
Certain Evergreen Funds, State Street Bank and Trust Company ("State Street")
and The Bank of New York ("BONY") entered into an amended financing agreement
on December 22, 1998. Under this agreement, 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 State Street and BONY. The
credit facility 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 facility, which was allocated to all funds. State Street served as
administrative agent and was entitled to a fee of $20,000 per annum which was
allocated to all of the funds. This agreement was terminated on July 27, 1999.
On July 27, 1999, certain Evergreen Funds and a group of banks (the "Lenders")
entered into a credit agreement. Under this agreement, the Lenders provide an
unsecured revolving credit commitment in the aggregate amount of $1.050 bil-
lion. The credit facility is allocated, under the terms of the financing agree-
ment, among the Lenders. The credit facility is accessed by the Funds for tem-
porary or emergency purposes to fund the redemption of their shares or for gen-
eral working capital purposes as permitted by each Fund's borrowing restric-
tions. 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 during the
period from and including December 1, 1999 through and including January 31,
2000). A commitment fee of 0.10% per annum is incurred on the average daily un-
used portion of the revolving credit commitment. The commitment fee is allo-
cated to all funds. For its assistance in arranging this financing agreement,
First Union Capital Markets Corp. was paid a one-time arrangement 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 funds.
During the year ended June 30, 2000, the Funds had no borrowings under these
agreements.
50
<PAGE>
Combined Notes to Financial Statements (continued)
11. CONCENTRATION OF RISK
The Funds may invest a substantial portion of assets in an industry or sector
and, therefore, may be more affected by changes in that industry or sector than
would be a comparable mutual fund that is not heavily weighted in any industry
or sector.
51
<PAGE>
Independent Auditors' Report
Board of Trustees and Shareholders
Evergreen Select Equity Trust
We have audited the accompanying statements of assets and liabilities, includ-
ing the schedules of investments of the Evergreen Equity Index Fund (formerly
Evergreen Select Equity Index Fund) and Evergreen Special Equity Fund (formerly
Evergreen Select Special Equity Fund), portfolios of Evergreen Select Equity
Trust, as of June 30, 2000, and the related statements of operations for the
year then ended, statements of changes in net assets for the years or periods
in the two-year period then ended, and the financial highlights for the years
or periods in the two-year period then ended. These financial statements and
financial highlights are the responsibility of the Funds' management. Our re-
sponsibility is to express an opinion on these financial statements and finan-
cial highlights based on our audits. The financial highlights for each of the
years or periods ended prior to the year ended June 30, 1999 were audited by
other auditors whose report, dated August 25, 1998, expressed an unqualified
opinion.
We conducted our audits in accordance with auditing standards generally ac-
cepted in the United States of America. Those standards require that we plan
and perform our audit to obtain reasonable assurance about whether the finan-
cial statements and financial highlights are free of material misstatement. An
audit includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. Our procedures included confirmation
of securities owned as of June 30, 2000 by correspondence with the custodian
and brokers. An audit also includes assessing the accounting principles used
and significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a reason-
able basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of Ever-
green Equity Index Fund and Evergreen Special Equity Fund as of June 30, 2000,
the results of their operations, changes in their net assets and financial
highlights for each of the years or periods described above in conformity with
accounting principles generally accepted in the United States of America.
/s/ KPMG LLP
Boston, Massachusetts
August 11, 2000
52
<PAGE>
Additional Information (unaudited)
FEDERAL TAX STATUS OF DISTRIBUTIONS
Pursuant to section 852 of the Internal Revenue Code, the Funds have designated
the following amounts as long-term capital gain distributions for the year
ended June 30, 2000.
<TABLE>
<CAPTION>
Aggregate Per share
---------- ---------
<S> <C> <C>
Equity Index Fund.......................... $4,048,733 $0.254
Special Equity Fund........................ 3,165,970 0.290
</TABLE>
For corporate shareholders, the following percentages of ordinary income divi-
dends paid during the fiscal year ended June 30, 2000 qualified for the divi-
dends received deductions.
<TABLE>
<S> <C>
Equity Index Fund......................................... 94.72%
Special Equity Fund....................................... 2.63
</TABLE>
53
<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
Adjustable Rate Fund
Limited Duration Fund
Growth and Income/
Balanced
Equity Income Fund
Balanced Fund
Growth
Special Equity Fund
Small Cap Growth Fund
Secular Growth Fund
Strategic Growth Fund
Core Equity Fund
Equity Index Fund
Strategic Value Fund
58885 555723 8/2000
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BULK RATE
U.S. POSTAGE
PAID
PERMIT NO. 19
[LOGO OF EVERGREEN FUNDS] HUDSON, MA
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200 Berkeley Street
Boston MA 02116
