EVERGREEN EQUITY TRUST /DE/, 485BPOS, 1998-01-30

EVERGREEN EQUITY TRUST /DE/
485BPOS, 1998-01-30

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1933 Act No. 333-37453
1940 Act No. 811-8413

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

Form N-1A

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [ ]
Pre-Effective Amendment No. [ ]
Post-Effective Amendment No. 3 [X]

and/or

REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [ ]
Amendment No. 2 [X]

EVERGREEN EQUITY TRUST
(Exact Name of Registrant as Specified in Charter)

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

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

The Corporation Trust Company
1209 Orange Street
Wilmington, Delaware 19801
(Name and Address of Agent for Service)

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

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

<PAGE>

EVERGREEN EQUITY TRUST

CONTENTS OF
POST-EFFECTIVE AMENDMENT NO. 3
to
REGISTRATION STATEMENT

This Post-Effective Amendment No. 3 to Registrant's Registration Statement
No. 333-37453/811-8413 consists of the following pages, items of information and
documents:

The Facing Sheet

The Contents Page

The Cross-Reference Sheet

PART A
------

Prospectuses for Evergreen Aggressive Growth Fund, Evergreen Fund, Evergreen
Micro Cap Fund, Evergreen Omega Fund, Evergreen Small Company Growth Fund and
Evergreen Strategic Growth Fund iS contained herein.

Prospectuses for the following funds are contained in Registration Statement
No. 333-37453/811-8413 filed on December 12, 1997: Evergreen American Retirement
Fund, Evergreen Foundation Fund, Evergreen Tax Strategic Foundation Fund,
Evergreen Fund for Total Return, Evergreen Growth and Income Fund, Evergreen
Income and Growth Fund, Evergreen Small Cap Equity Income Fund, Evergreen Value
Fund, Evergreen Utility Fund, and Evergreen Blue Chip Fund.

Prospectuses for Evergreen Balanced Fund are contained in Registration
Statement No. 333-37453/811-8413 filed on November 10, 1997.

PART B
------

Statement of Additional Information for Evergreen Aggressive Growth Fund,
Evergreen Fund, Evergreen Micro Cap Fund, Evergreen Omega Fund, Evergreen Small
Company Growth Fund and Evergreen Strategic Growth Fund is contained herein.

Statement of Additional Information for the following funds are contained in
Registration Statement No. 333-37453/811-8413 filed on December 12, 1997:
Evergreen American Retirement Fund, Evergreen Foundation Fund, Evergreen Tax
Strategic Foundation Fund Evergreen Fund for Total Return, Evergreen Growth and
Income Fund, Evergreen Income and Growth Fund, Evergreen Small Cap Equity Income
Fund, Evergreen Value Fund, Evergreen Utility Fund, and Evergreen Blue Chip
Fund.

Statement of Additional Information for Evergreen Balanced Fund are contained in
Registration Statement No. 333-37453/811-8413 filed on November 10, 1997.

PART C
------

Financial Statements

Exhibits

Number of Holders of Securities

Indemnification

Business and Other Connections of Investment Adviser

Principal Underwriter

Location of Accounts and Records

Undertakings

Signatures
<PAGE>

EVERGREEN EQUITY TRUST

Cross-Reference Sheet pursuant to Rules 404 and 495 under the Securities
Act of 1933.
<TABLE>
<CAPTION>
N-1A Item No. Location in Prospectus(es)
<S> <C>
Part A

Item 1. Cover Page Cover Page

Item 2. Synopsis and Fee Table Expense Information; Performance Data

Item 3. Condensed Financial Information Financial Highlights

Item 4. General Description of Registrant Additional Investment Information; Cover Page; Fund Description; Fund Objectives
and Polices; Investment Restrictions; Risk Factors; General Information

Item 5. Management of the Fund Fund Management; Expenses

Item 6. Capital Stock and Other Securities Fund Description; Dividends and Taxes; Fund Shares; Shareholder Services

Item 7. Purchase of Securities Being Offered Distribution Plan; How to Buy Shares; Pricing Shares; Shareholders Services

Item 8. Redemption or Repurchase How to Redeem Shares

Item 9. Pending Legal Proceedings Not Applicable

Location in Statement of
Part B Additional Information

Item 10. Cover Page Cover Page

Item 11. Table of Contents Table of Contents

Item 12. General Information and History Not Applicable

Item 13. Investment Objectives and Policies The Fund; Investment Restrictions; Appendix

Item 14. Management of the Fund Directors and Officers

Item 15. Control Persons and Principal Additional Information
Holders of Securities

Item 16. Investment Advisory and Other Services Additional Information; Distribution Plan; Expenses; Investment Adviser; Principal
Underwriter; Sales Charges; Service Providers

Item 17. Brokerage Allocation Brokerage

Item 18. Capital Stock and Other Securities Articles of Incorporation

Item 19. Purchase, Redemption and Pricing of Valuation of Securities; Securities Being Offered Distribution Plans; Additional
Information

Item 20. Tax Status Distributions and Taxes

Item 21. Underwriters Principal Underwriter

Item 22. Calculation of Performance Data Standardized Total Return and Yield Quaotations

Item 23. Financial Statements Financial Statements
</TABLE>

Part C

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

<PAGE>

EVERGREEN EQUITY TRUST

PART A

PROSPECTUSES

<PAGE>
PROSPECTUS February 1, 1998
EVERGREEN DOMESTIC GROWTH FUNDS (Evergreen Funds logo
EVERGREEN FUND appears here)
EVERGREEN MICRO CAP FUND
EVERGREEN AGGRESSIVE GROWTH FUND
EVERGREEN OMEGA FUND
EVERGREEN SMALL COMPANY GROWTH FUND
EVERGREEN STRATEGIC GROWTH FUND
CLASS A SHARES
CLASS B SHARES
CLASS C SHARES
The Evergreen Domestic Growth Funds (the "Funds") are designed to
provide investors with a selection of investment alternatives which seek to
provide capital growth and diversification. This prospectus provides
information regarding the Class A, Class B and Class C shares offered by
the Funds. Each Fund is a diversified series of an open-end, management
investment company. This prospectus sets forth concise information about
the Funds that a prospective investor should know before investing. The
address of the Funds is 200 Berkeley Street, Boston, Massachusetts 02116.
A Statement of Additional Information for the Funds dated February
1, 1998, as supplemented from time to time, has been filed with the
Securities and Exchange Commission and is incorporated by reference herein.
The Statement of Additional Information provides information regarding
certain matters discussed in this prospectus and other matters which may be
of interest to investors, and may be obtained without charge by calling the
Funds at (800) 343-2898. There can be no assurance that the investment
objective of any Fund will be achieved. Investors are advised to read this
prospectus carefully.
AN INVESTMENT IN THE FUNDS IS NOT A DEPOSIT OR OBLIGATION OF ANY BANK, IS
NOT ENDORSED OR GUARANTEED BY ANY BANK, AND IS NOT INSURED OR OTHERWISE
PROTECTED BY THE U.S. GOVERNMENT, THE FEDERAL DEPOSIT INSURANCE
CORPORATION, THE FEDERAL RESERVE BOARD, OR ANY OTHER GOVERNMENT AGENCY AND
INVOLVES RISK, INCLUDING THE POSSIBLE LOSS OF PRINCIPAL.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION
TO THE CONTRARY IS A CRIMINAL OFFENSE.
KEEP THIS PROSPECTUS FOR FUTURE REFERENCE

<PAGE>
TABLE OF CONTENTS
<TABLE>
<S> <C>
EXPENSE INFORMATION 3
FINANCIAL HIGHLIGHTS 5
DESCRIPTION OF THE FUNDS 14
Investment Objectives and Policies 14
Investment Practices and Restrictions 16
ORGANIZATION AND SERVICE PROVIDERS 20
Organization 20
Service Providers 20
Distribution Plans and Agreements 22
PURCHASE AND REDEMPTION OF SHARES 23
How to Buy Shares 23
How to Redeem Shares 26
Exchange Privilege 27
Shareholder Services 28
Banking Laws 29
OTHER INFORMATION 29
Dividends, Distributions and Taxes 29
General Information 30
</TABLE>

<PAGE>
EXPENSE INFORMATION
The table and examples below are designed to help you understand the
various expenses that you will bear, directly or indirectly, when you invest in
a Fund. Shareholder transaction expenses are fees paid directly from your
account when you buy or sell shares of a Fund.
<TABLE>
<CAPTION>
SHAREHOLDER TRANSACTION EXPENSES Class A Shares Class B Shares Class C Shares
<S> <C> <C> <C>
Maximum Sales Charge Imposed on Purchases 4.75% None None
(as a % of offering price)
Maximum Sales Charge Imposed on Reinvested Dividends None None None
(as a % of offering price)
Maximum Contingent Deferred Sales Charge (as a % of original None(1) 5%(2) 1%(2)
purchase price or redemption proceeds, whichever is lower)
</TABLE>
Annual operating expenses reflect the normal operating expenses of a
Fund, and include costs such as management, distribution and other fees. The
table below shows for each of EVERGREEN FUND, EVERGREEN MICRO CAP FUND,
EVERGREEN AGGRESSIVE GROWTH FUND and EVERGREEN OMEGA FUND actual annual
operating expenses for the fiscal period ended September 30, 1997 and for
EVERGREEN SMALL COMPANY GROWTH FUND and EVERGREEN STRATEGIC GROWTH FUND, annual
operating expenses have been estimated for the fiscal period ending September
30, 1998. The examples show what you would pay if you invested $1,000 over the
periods indicated. The examples assume that you reinvest all of your dividends
and that a Fund's average annual return will be 5%. THE EXAMPLES ARE FOR
ILLUSTRATION PURPOSES ONLY AND SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST
OR FUTURE EXPENSES OR ANNUAL RETURN. A FUND'S ACTUAL EXPENSES AND RETURNS WILL
VARY. For a more complete description of the various costs and expenses borne by
a Fund see "Organization and Service Providers."
EVERGREEN FUND
<TABLE>
<CAPTION>
EXAMPLES
Assuming
Assuming Redemption No
ANNUAL OPERATING EXPENSES at End of Period Redemption
Class A Class B Class C Class A Class B Class C Class B
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Management Fees 0.92% 0.92% 0.92% After 1 Year $ 61 $ 72 $ 32 $ 22
12b-1 Fees (3) 0.25% 1.00% 1.00% After 3 Years $ 90 $ 97 $ 68 $ 67
Other Expenses 0.23% 0.23% 0.24% After 5 Years $ 120 $ 135 $ 116 $ 115
Total 1.40% 2.15% 2.16% After 10 Years $ 207 $ 220 $ 249 $ 220

<CAPTION>
Class C
<S> <C>
Management Fees $ 22
12b-1 Fees (3) $ 68
Other Expenses $ 116
Total $ 249
</TABLE>

EVERGREEN MICRO CAP FUND
<TABLE>
<CAPTION>
EXAMPLES
Assuming
Assuming Redemption at End of No
ANNUAL OPERATING EXPENSES Period Redemption
Class A Class B Class C Class A Class B Class C Class B
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Management Fees 1.00% 1.00% 1.00% After 1 Year $ 65 $ 76 $ 36 $ 26
12b-1 Fees (3) 0.25% 1.00% 1.00% After 3 Years $ 101 $ 111 $ 80 $ 81
Other Expenses 0.54% 0.59% 0.56% After 5 Years $ 140 $ 158 $ 136 $ 138
Total 1.79% 2.59% 2.56% After 10 Years $ 248 $ 263 $ 290 $ 263

<CAPTION>
Class C
<S> <C>
Management Fees $ 26
12b-1 Fees (3) $ 80
Other Expenses $ 136
Total $ 290
</TABLE>

EVERGREEN AGGRESSIVE GROWTH FUND
<TABLE>
<CAPTION>
EXAMPLES
Assuming
Assuming Redemption at End of No
ANNUAL OPERATING EXPENSES Period Redemption
Class A Class B Class C Class A Class B Class C Class B
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Management Fees 0.64% 0.64% 0.64% After 1 Year $ 60 $ 71 $ 31 $ 21
12b-1 Fees (3) 0.25% 1.00% 1.00% After 3 Years $ 86 $ 93 $ 63 $ 63
Other Expenses 0.37% 0.38% 0.38% After 5 Years $ 113 $ 129 $ 109 $ 109
Total 1.26% 2.02% 2.02% After 10 Years $ 193 $ 206 $ 235 $ 206

<CAPTION>
Class C
<S> <C>
Management Fees $ 21
12b-1 Fees (3) $ 63
Other Expenses $ 109
Total $ 235
</TABLE>

<PAGE>
EVERGREEN OMEGA FUND
<TABLE>
<CAPTION>
EXAMPLES
Assuming
Assuming Redemption at End of No
ANNUAL OPERATING EXPENSES Period Redemption
Class A Class B Class C Class A Class B Class C Class B
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Management Fees 0.74% 0.74% 0.74% After 1 Year $ 60 $ 72 $ 32 $ 22
12b-1 Fees (3) 0.25% 1.00% 1.00% After 3 Years $ 87 $ 98 $ 68 $ 68
Other Expenses 0.33% 0.44% 0.44% After 5 Years $ 116 $ 137 $ 117 $ 117
Total 1.32% 2.18% 2.18% After 10 Years $ 199 $ 219 $ 251 $ 219
<CAPTION>
Class C
<S> <C>
Management Fees $ 22
12b-1 Fees (3) $ 68
Other Expenses $ 117
Total $ 251
</TABLE>

EVERGREEN SMALL COMPANY GROWTH FUND
<TABLE>
<CAPTION>
EXAMPLES
Assuming
Assuming Redemption at End of No
ANNUAL OPERATING EXPENSES Period Redemption
Class A Class B Class C Class A Class B Class C Class B
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Management Fees 0.48% 0.48% 0.48% After 1 Year $ 57 $ 68 $ 28 $ 18
12b-1 Fees (3) 0.25% 1.00% 1.00% After 3 Years $ 78 $ 86 $ 56 $ 56
Other Expenses 0.29% 0.29% 0.29% After 5 Years $ 101 $ 116 $ 96 $ 96
Total 1.02% 1.77% 1.77% After 10 Years $ 166 $ 179 $ 208 $ 179
<CAPTION>
Class C
<S> <C>
Management Fees $ 18
12b-1 Fees (3) $ 56
Other Expenses $ 96
Total $ 208
</TABLE>

EVERGREEN STRATEGIC GROWTH FUND
<TABLE>
<CAPTION>
EXAMPLES
Assuming
Assuming Redemption at End of No
ANNUAL OPERATING EXPENSES Period Redemption
Class A Class B Class C Class A Class B Class C Class B
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Management Fees 0.53% 0.53% 0.53% After 1 Year $ 58 $ 69 $ 29 $ 19
12b-1 Fees (3) 0.25% 1.00% 1.00% After 3 Years $ 81 $ 88 $ 58 $ 58
Other Expenses 0.32% 0.32% 0.32% After 5 Years $ 105 $ 120 $ 100 $ 100
Total 1.10% 1.85% 1.85% After 10 Years $ 175 $ 188 $ 217 $ 188
<CAPTION>
Class C
<S> <C>
Total $ 19
12b-1 Fees (3) $ 58
Other Expenses $ 100
Total $ 217
</TABLE>

(1) Investments of $1 million or more are not subject to a front-end sales
charge, but may be subject to a contingent deferred sales charge upon
redemption within one year after the month of purchase.
(2) The deferred sales charge on Class B shares declines from 5% to 1% on
amounts redeemed within six years after the month of purchase. The deferred
sales charge on Class C shares is 1% on amounts redeemed within one year
after the month of purchase. No sales charge is imposed on redemptions made
thereafter. See "Purchase and Redemption of Shares" for more information.
(3) Long-term shareholders may pay more than the economic equivalent front-end
sales charges permitted by the National Association of Securities Dealers,
Inc.
4

<PAGE>
FINANCIAL HIGHLIGHTS
The tables on the following pages present, for each Fund, financial
highlights for a share outstanding throughout each period indicated. The
information in the tables for the ten most recent fiscal years or the life of
the Fund, if shorter, for EVERGREEN FUND has been audited by Price Waterhouse
LLP, the Fund's independent auditors. The information in the tables for
EVERGREEN MICRO CAP FUND for the fiscal years ended September 30, 1997 and 1996
has been audited by Price Waterhouse LLP, the Fund's current independent
auditors. The information in the tables for the Fund's fiscal period ended
September 30, 1995 was audited by the Fund's prior independent auditors. The
information in the tables for EVERGREEN AGGRESSIVE GROWTH FUND for the fiscal
periods ended September 30, 1997 through 1995 has been audited by Price
Waterhouse LLP, the Fund's current independent auditors. The information in the
tables for each of the years in the six-year period ended October 31, 1994, the
ten months ended October 31, 1988 and for the year ended December 31, 1987 was
audited by the Fund's prior independent auditors. The information in the tables
for EVERGREEN OMEGA FUND for the fiscal period ended September 30, 1997 and for
each of the years in the eight-year period ended December 31, 1996 for Class A
shares, for the fiscal period ended September 30, 1997 and for each of the years
in the three-year period ended December 31, 1996, and the period from August 2,
1993 (date of initial public offering) to December 31, 1993 for Class B and
Class C shares has been audited by KPMG Peat Marwick LLP, the Fund's independent
auditors. The information in the tables for each of the years in the two-year
period ended December 31, 1988 for Class A shares was audited by the Fund's
prior independent auditors. The information in the tables for EVERGREEN SMALL
COMPANY GROWTH FUND for the fiscal period ended September 30, 1997 and for each
of the years in the ten-year period ended May 31, 1996 was audited by KPMG Peat
Marwick LLP, the Fund's current independent auditors. The information in the
tables for EVERGREEN STRATEGIC GROWTH FUND for the fiscal period ended September
30, 1997 and for each of the years in the ten-year period ended October 31, 1996
was audited by KPMG Peat Marwick LLP, the Fund's current independent auditors.
Class A and Class C shares of EVERGREEN SMALL COMPANY GROWTH FUND and EVERGREEN
STRATEGIC GROWTH FUND were not offered until January 20, 1998. Therefore, no
financial highlights are currently available for those shares. A report of Price
Waterhouse LLP or KPMG Peat Marwick LLP, as the case may be, on the audited
information with respect to each Fund is incorporated by reference in the
Statement of Additional Information. The following information for each Fund
should be read in conjunction with the financial statements and related notes
which are incorporated by reference in the Statement of Additional Information.
Further information about each Fund's performance is contained in the
Fund's Annual Report to shareholders, which may be obtained without charge.
5

<PAGE>
EVERGREEN FUND -- CLASS A, B AND C SHARES
<TABLE>
<CAPTION>
CLASS C
SHARES
CLASS A SHARES CLASS B SHARES YEAR ENDED
SEPTEMBER
YEAR ENDED SEPTEMBER 30, YEAR ENDED SEPTEMBER 30, 30,
1997| 1996 1995* 1997| 1996 1995* 1997|
<S> <C> <C> <C> <C> <C> <C> <C>
PER SHARE DATA:
Net asset value beginning of year... $17.64 $15.55 $11.97 $17.49 $15.48 $11.97 $17.47
Income from investment operations:
Net investment income............. 0.11 0.12 0.01 (0.03) (0.03) (0.02) (0.04)
Net realized and unrealized gain
on investments.................. 5.71 2.61 3.57 5.64 2.64 3.53 5.64
Total from investment
operations.................. 5.82 2.73 3.58 5.61 2.61 3.51 5.60
Less distributions from:
Net investment income............. (0.09) (0.06) 0 0 (0.02) 0 0
Net realized gain on
investments..................... (0.41) (0.58) 0 (0.41) (0.58) 0 (0.41)
Total distributions........... (0.50) (0.64) 0 (0.41) (0.60) 0 (0.41)
Net asset value end of year......... $22.96 $17.64 $15.55 $22.69 $17.49 $15.48 $22.66
TOTAL RETURN+....................... 33.72% 18.07% 29.91% 32.69% 17.29% 29.32% 32.67%
RATIOS & SUPPLEMENTAL DATA:
Ratios to average net assets:
Total expenses.................... 1.40% 1.45% 1.70%++ 2.15% 2.18% 2.32%++ 2.16%
Total expenses, excluding
indirectly paid expenses........ 1.40% N/A N/A 2.15% N/A N/A 2.16%
Total expenses, excluding fee
waivers & expense
reimbursements.................. N/A N/A 1.75%++ N/A N/A 2.34%++ N/A
Net investment income............. 0.58% 0.63% 0.13%++ (0.16%) (0.10%) (0.48%)++ (0.18%)
Portfolio turnover rate............. 12% 15% 19% 12% 15% 19% 12%
Average commission rate paid per
share............................. $0.0577 $0.0603 N/A $0.0577 $0.0603 N/A $0.0577
Net assets end of year (millions)... $161 $87 $29 $503 $254 $74 $9
<CAPTION>

1996 1995*
<S> <C> <C>
PER SHARE DATA:
Net asset value beginning of year... $15.48 $11.97
Income from investment operations:
Net investment income............. 0 (0.01)
Net realized and unrealized gain
on investments.................. 2.61 3.52
Total from investment
operations.................. 2.61 3.51
Less distributions from:
Net investment income............. (0.04) 0
Net realized gain on
investments..................... (0.58) 0
Total distributions........... (0.62) 0.00
Net asset value end of year......... $17.47 $15.48
TOTAL RETURN+....................... 17.29% 29.32%
RATIOS & SUPPLEMENTAL DATA:
Ratios to average net assets:
Total expenses.................... 2.14% 2.12%++
Total expenses, excluding
indirectly paid expenses........ N/A N/A
Total expenses, excluding fee
waivers & expense
reimbursements.................. 2.38% 5.31%++
Net investment income............. (0.07%) (0.31%)++
Portfolio turnover rate............. 15% 19%
Average commission rate paid per
share............................. $0.0603 N/A
Net assets end of year (millions)... $6 $2
</TABLE>

| Calculated based on average shares outstanding throughout the period.
+ Initial sales charge or contingent deferred sales charge is not reflected.
++ Annualized.
* For the period from January 3, 1995 (commencement of class operations) to
September 30, 1995.
6

<PAGE>
EVERGREEN MICRO CAP FUND -- CLASS A, B AND C SHARES
<TABLE>
<CAPTION>
CLASS C
SHARES
CLASS A SHARES CLASS B SHARES YEAR ENDED
SEPTEMBER
YEAR ENDED SEPTEMBER 30, YEAR ENDED SEPTEMBER 30, 30,
1997| 1996 1995* 1997| 1996 1995* 1997|
<S> <C> <C> <C> <C> <C> <C> <C>
PER SHARE DATA:
Net asset value beginning of year... $17.31 $18.41 $15.76 $17.07 $18.30 $15.76 $17.09
Income from investment operations:
Net investment loss............... (0.15) (0.10) (0.10) (0.28) (0.25) (0.20) (0.25)
Net realized and unrealized gain
(loss) on investments........... 9.52 (0.44) 2.75 9.35 (0.42) 2.74 9.32
Total from investment
operations.................. 9.37 (0.54) 2.65 9.07 (0.67) 2.54 9.07
Less distributions from:
Net realized gain on
investments..................... 0 (0.56) 0 0 (0.56) 0 0
Total distributions........... 0 (0.56) 0 0 (0.56) 0 0
Net asset value end of year......... $26.68 $17.31 $18.41 $26.14 $17.07 $18.30 $26.16
TOTAL RETURN+....................... 54.13% (2.90%) 16.81% 53.13% (3.64%) 16.12% 53.07%
RATIOS & SUPPLEMENTAL DATA:
Ratios to average net assets:
Total expenses.................... 1.79% 1.73% 1.51%++ 2.59% 2.47% 2.26%++ 2.56%
Interest expense.................. 0.02% 0.02% N/A 0.02% 0.02% N/A 0.02%
Total expenses, excluding
indirectly paid expenses........ 1.78% N/A N/A 2.58% N/A N/A 2.55%
Total expenses, excluding fee
waiver & expense
reimbursement................... N/A 3.08% 4.33%++ N/A 3.26% 3.66%++ N/A
Net investment loss............... (0.73%) (0.52%) (1.03%)++ (1.44%) (1.28%) (1.77%)++ (1.50%)
Portfolio turnover rate............. 59% 160% 84% 59% 160% 84% 59%
Average commission rate paid per
share............................. $0.0543 $0.0465 N/A $0.0543 $0.0465 N/A $0.0543
Net assets end of year
(thousands)....................... $2,438 $903 $1,089 $1,713 $1,461 $2,020 $261
<CAPTION>

1996 1995*
<S> <C> <C>
PER SHARE DATA:
Net asset value beginning of year... $18.31 $15.76
Income from investment operations:
Net investment loss............... (0.35) (0.20)
Net realized and unrealized gain
(loss) on investments........... (0.31) 2.75
Total from investment
operations.................. (0.66) 2.55
Less distributions from:
Net realized gain on
investments..................... (0.56) 0
Total distributions........... (0.56) 0
Net asset value end of year......... $17.09 $18.31
TOTAL RETURN+....................... (3.58%) 16.18%
RATIOS & SUPPLEMENTAL DATA:
Ratios to average net assets:
Total expenses.................... 2.44% 2.25%++
Interest expense.................. 0.02% N/A
Total expenses, excluding
indirectly paid expenses........ N/A N/A
Total expenses, excluding fee
waiver & expense
reimbursement................... 32.28% 41.34%++
Net investment loss............... (1.35%) (1.76%)++
Portfolio turnover rate............. 160% 84%
Average commission rate paid per
share............................. $0.0465 N/A
Net assets end of year
(thousands)....................... $27 $62
</TABLE>

| Calculated based on average shares outstanding throughout the period.
* For the period from January 3, 1995 (commencement of class operations) to
September 30, 1995.
+ Initial sales charge or contingent deferred sales charge is not reflected.
++ Annualized.
7

<PAGE>
EVERGREEN AGGRESSIVE GROWTH FUND -- CLASS A SHARES
<TABLE>
<CAPTION>
YEAR ENDED
SEPTEMBER 30, YEAR ENDED OCTOBER 31,
1997| 1996 1995* 1994#| 1993#| 1992#| 1991#|
<S> <C> <C> <C> <C> <C> <C> <C>
PER SHARE DATA:
Net asset value beginning of
year....................... $21.04 $17.37 $13.85 $14.44 $11.76 $12.22 $7.37
Income from investment
operations:
Net investment loss........ (0.21) (0.15) (0.16) (0.13) (0.12) (0.10) (0.08)
Net realized and unrealized
gain (loss) on
investments.............. 2.65 4.46 3.68 (0.22) 3.06 1.84 5.59
Total from investment
operations........... 2.44 4.31 3.52 (0.35) 2.94 1.74 5.51
Less distributions from:
Net realized gain on
investments.............. 0 (0.64) 0 (0.24) (0.26) (2.20) (0.66)
Total distributions.... 0 (0.64) 0 (0.24) (0.26) (2.20) (0.66)
Net asset value end of
year....................... $23.48 $21.04 $17.37 $13.85 $14.44 $11.76 $12.22
TOTAL RETURN+............... 11.60% 25.62% 25.42% (2.42%) 25.31% 17.43% 79.80%
RATIOS & SUPPLEMENTAL DATA:
Ratios to average net
assets:
Total expenses............. 1.26% 1.22% 1.47%++ 1.25% 1.31% 1.44% 1.59%
Total expenses, excluding
indirectly paid
expenses................. 1.25% N/A N/A N/A N/A N/A N/A
Net investment loss........ (1.05%) (0.86%) (1.12%)++ (0.92%) (0.92%) (0.93%) (0.71%)
Portfolio turnover rate..... 56% 33% 31% 59% 48% 46% 108%
Average commission rate paid
per share.................. $0.0531 $0.0582 N/A N/A N/A N/A N/A
Net assets end of year
(thousands)................ $173,982 $96,608 $70,858 $64,635 $58,053 $29,302 $23,509
<CAPTION>
YEAR ENDED
DECEMBER 31,
1990#| 1989#| 1988**#| 1987#|
<S> <C> <C> <C> <C>
PER SHARE DATA:
Net asset value beginning of
year....................... $11.06 $7.62 $7.07 $8.77
Income from investment
operations:
Net investment loss........ (0.04) (0.11) (0.21) (0.11)
Net realized and unrealized
gain (loss) on
investments.............. (2.02) 3.55 0.76 (1.34)
Total from investment
operations........... (2.06) 3.44 0.55 (1.45)
Less distributions from:
Net realized gain on
investments.............. (1.63) 0 0 (0.25)
Total distributions.... (1.63) 0 0 (0.25)
Net asset value end of
year....................... $7.37 $11.06 $7.62 $7.07
TOTAL RETURN+............... (20.45%) 45.14% 7.78% (16.51%)
RATIOS & SUPPLEMENTAL DATA:
Ratios to average net
assets:
Total expenses............. 1.86% 1.78% 2.02%++ 1.57%
Total expenses, excluding
indirectly paid
expenses................. N/A N/A N/A N/A
Net investment loss........ (0.49%) (1.19%) (1.36%)++ (1.05%)
Portfolio turnover rate..... 100% 120% 45% 65%
Average commission rate paid
per share.................. N/A N/A N/A N/A
Net assets end of year
(thousands)................ $14,325 $21,241 $19,900 $25,700
</TABLE>

| Calculations based on average shares outstanding throughout the period.
++ Annualized.
+ Initial sales charge or contingent deferred sales charge is not reflected.
* For the eleven months ended September 30, 1995. The Fund changed its fiscal
year end from October 31 to September 30, effective September 30, 1995.
** For the ten months ended October 31, 1988. The Fund changed its fiscal year
end from December 31 to October 31, effective October 31, 1988.
# Effective June 30, 1995, Evergreen Aggressive Growth Fund, a new series of
Evergreen Trust, acquired substantially all of the net assets of ABT
Emerging Growth Fund. ABT Emerging Growth Fund, which had a fiscal year that
ended on October 31 was the accounting survivor in the combination.
Accordingly, the information above includes the results of operations of ABT
Emerging Growth Fund prior to June 30, 1995.
8

<PAGE>
EVERGREEN AGGRESSIVE GROWTH FUND -- CLASS B AND C SHARES
<TABLE>
<CAPTION>
CLASS B SHARES CLASS C SHARES
YEAR ENDED SEPTEMBER 30, YEAR ENDED SEPTEMBER 30,
1997| 1996 1995* 1997| 1996
<S> <C> <C> <C> <C> <C>
PER SHARE DATA:
Net asset value beginning of year.......................... $20.89 $17.35 $15.82 $20.88 $17.31
Income from investment operations:
Net investment loss...................................... (0.37) (0.16) (0.03) (0.36) (0.15)
Net realized and unrealized gain on investments.......... 2.66 4.34 1.56 2.64 4.36
Total from investment operations..................... 2.29 4.18 1.53 2.28 4.21
Less distributions from:
Net realized gain on investments......................... 0 (0.64) 0 0 (0.64)
Total distributions.................................. 0 (0.64) 0 0 (0.64)
Net asset value end of year................................ $23.18 $20.89 $17.35 $23.16 $20.88
TOTAL RETURN+.............................................. 10.96% 24.88% 9.67% 10.92% 25.11%
RATIOS & SUPPLEMENTAL DATA:
Ratios to average net assets:
Total expenses........................................... 2.02% 1.98% 2.09%++ 2.02% 1.96%
Total expenses, excluding indirectly paid expenses....... 2.01% N/A N/A 2.01% N/A
Net investment loss...................................... (1.80%) (1.60%) (1.71%)++ (1.80%) (1.57%)
Portfolio turnover rate.................................... 56% 33% 31% 56% 33%
Average commission rate paid per share..................... $0.0531 $0.0582 N/A $0.0531 $0.0582
Net assets end of year (thousands)......................... $41,167 $21,644 $2,858 $3,992 $991
<CAPTION>

1995**
<S> <C>
PER SHARE DATA:
Net asset value beginning of year.......................... $16.42
Income from investment operations:
Net investment loss...................................... (0.01)
Net realized and unrealized gain on investments.......... 0.90
Total from investment operations..................... 0.89
Less distributions from:
Net realized gain on investments......................... 0
Total distributions.................................. 0
Net asset value end of year................................ $17.31
TOTAL RETURN+.............................................. 5.42%
RATIOS & SUPPLEMENTAL DATA:
Ratios to average net assets:
Total expenses........................................... 2.09%++
Total expenses, excluding indirectly paid expenses....... N/A
Net investment loss...................................... (1.51%)++
Portfolio turnover rate.................................... 31%
Average commission rate paid per share..................... N/A
Net assets end of year (thousands)......................... $416
</TABLE>

| Calculations based on average shares outstanding throughout the period.
* For the period from July 7, 1995 (commencement of class operations) to
September 30, 1995.
** For the period from August 3, 1995 (commencement of class operations) to
September 30, 1995.
+ Initial sales charge or contingent deferred sales charge is not reflected.
++ Annualized.
9

<PAGE>
EVERGREEN OMEGA FUND -- CLASS A SHARES
<TABLE>
<CAPTION>
NINE MONTHS
ENDED
SEPTEMBER 30, YEAR ENDED DECEMBER 31,
1997#| 1996 1995 1994 1993 1992| 1991 1990
<S> <C> <C> <C> <C> <C> <C> <C> <C>
PER SHARE DATA:
Net asset value beginning of
period...................... $19.52 $19.56 $15.54 $17.11 $15.84 $17.68 $13.37 $16.03
Income from investment
operations:
Net investment income
(loss).................... (0.03) (0.06) 0 0.04 (0.07) 0 (0.04) 0.11
Net realized and unrealized
gain (loss) on
investments............... 4.05 2.15 5.58 (1.00) 3.07 0.39 6.92 (0.39)
Total from investment
operations.............. 4.02 2.09 5.58 (0.96) 3.00 0.39 6.88 (0.28)
Less distributions from:
Net investment income....... 0 0 0 0 0 0 (0.02) (0.25)
In excess of net investment
income.................... 0 0 0 0 0 0 (0.05) (0.04)
Net realized gain on
investments............... (0.85) (2.13) (1.56) (0.61) (1.73) (2.23) (2.50) (2.09)
Total distributions....... (0.85) (2.13) (1.56) (0.61) (1.73) (2.23) (2.57) (2.38)
Net asset value end of
period...................... $22.69 $19.52 $19.56 $15.54 $17.11 $15.84 $17.68 $13.37
TOTAL RETURN+................ 21.45% 11.31% 36.94% (5.66%) 19.33% 4.00% 54.49% (2.38%)
RATIOS & SUPPLEMENTAL DATA:
Ratios to average net assets:
Total expenses.............. 1.32%++ 1.33% 1.38% 1.41% 1.51% 1.52% 1.57% 1.73%
Total expenses, excluding
indirectly paid
expenses.................. 1.31%++ 1.32% 1.37% N/A N/A N/A N/A N/A
Net investment income
(loss).................... (0.20%)++ (0.29%) 0.00% 0.27% (.48%) (0.01%) (0.31%) 0.70%
Portfolio turnover rate...... 76% 173% 159% 137% 162% 176% 115% 108%
Average commission rate paid
per share................... $0.0580 $0.0621 N/A N/A N/A N/A N/A N/A
Net assets end of period
(thousands)................. $162,847 $154,825 $135,079 $99,569 $90,404 $73,144 $58,671 $38,531
<CAPTION>

1989 1988 1987
<S> <C> <C> <C>
PER SHARE DATA:
Net asset value beginning of
period...................... $13.66 $12.08 $13.44
Income from investment
operations:
Net investment income
(loss).................... 0.17 0.30(a) 0.02
Net realized and unrealized
gain (loss) on
investments............... 4.30 1.40 1.11
Total from investment
operations.............. 4.47 1.70 1.13
Less distributions from:
Net investment income....... (0.20) (0.12) (0.24)
In excess of net investment
income.................... 0 0 0
Net realized gain on
investments............... (1.90) 0 (2.25)
Total distributions....... (2.10) (0.12) (2.49)
Net asset value end of
period...................... $16.03 $13.66 $12.08
TOTAL RETURN+................ 33.05% 14.05% 8.27%
RATIOS & SUPPLEMENTAL DATA:
Ratios to average net assets:
Total expenses.............. 1.84% 1.78% 1.99%
Total expenses, excluding
indirectly paid
expenses.................. N/A N/A N/A
Net investment income
(loss).................... 1.03% 2.22% 0.13%
Portfolio turnover rate...... 77% 84% 106%
Average commission rate paid
per share................... N/A N/A N/A
Net assets end of period
(thousands)................. $39,682 $33,951 $30,246
</TABLE>

| Calculated based on average shares outstanding throughout the period.
+ Initial sales charge or contingent deferred sales charge is not reflected.
++ Annualized.
# The Fund changed its fiscal year end from December 31 to September 30,
effective September 30, 1997.
(a) Includes $0.17 per share relating to a special non-recurring distribution
from Inco Limited.
10

<PAGE>
EVERGREEN OMEGA FUND -- CLASS B AND C SHARES
<TABLE>
<CAPTION>
CLASS B SHARES CLASS C SHARES
NINE MONTHS NINE MONTHS
ENDED ENDED YEAR ENDED
SEPTEMBER 30, YEAR ENDED DECEMBER 31, SEPTEMBER 30, DECEMBER 31,
1997#| 1996 1995 1994 1993* 1997#| 1996 1995
<S> <C> <C> <C> <C> <C> <C> <C> <C>
PER SHARE DATA:
Net asset value beginning of
period............................ $18.83 $19.10 $15.34 $17.06 $17.29 $18.86 $19.13 $15.37
Income from investment operations:
Net investment income (loss)...... (0.15) (0.17) (0.09) (0.06) (0.05) (0.15) (0.18) (0.13)
Net realized and unrealized gain
(loss) on investments........... 3.88 2.03 5.41 (1.60) 1.55 3.88 2.04 5.45
Total from investment
operations.................... 3.73 1.86 5.32 (1.66) 1.50 3.73 1.86 5.32
Less distributions from:
Net realized gain on
investments..................... (0.85) (2.13) (1.56) (0.06) (1.73) (0.85) (2.13) (1.56)
Total distributions............. (0.85) (2.13) (1.56) (0.06) (1.73) (0.85) (2.13) (1.56)
Net asset value end of period...... $21.71 $18.83 $19.10 $15.34 $17.06 $21.74 $18.86 $19.13
TOTAL RETURN+...................... 20.68% 10.31% 35.70% (6.57%) 9.02% 20.65% 10.29% 35.62%
RATIOS & SUPPLEMENTAL DATA:
Ratios to average net assets:
Total expenses.................... 2.18%++ 2.20% 2.29% 2.30% 2.57%++ 2.18%++ 2.21% 2.30%
Total expenses, excluding
indirectly paid expenses........ 2.17%++ 2.18% 2.27% N/A N/A 2.17%++ N/A N/A
Net investment income (loss)...... (1.06%)++ (1.15%) (0.94%) (0.58%) (1.73%)++ (1.05%)++ (1.17%) (0.91%)
Portfolio turnover rate............ 76% 173% 159% 137% 162% 76% 173% 159%
Average commission rate paid per
share............................. $0.0580 $0.0621 N/A N/A N/A $0.0580 $0.0621 N/A
Net assets end of period
(thousands)....................... $110,349 $89,921 $71,636 $32,266 $7,423 $16,067 $17,628 $13,963
<CAPTION>

1994 1993*
<S> <C> <C>
PER SHARE DATA:
Net asset value beginning of
period............................ $17.09 $17.29
Income from investment operations:
Net investment income (loss)...... (0.07) (0.06)
Net realized and unrealized gain
(loss) on investments........... (1.04) 1.59
Total from investment
operations.................... (1.11) 1.53
Less distributions from:
Net realized gain on
investments..................... (0.61) (1.73)
Total distributions............. (0.61) (1.73)
Net asset value end of period...... $15.37 $17.09
TOTAL RETURN+...................... (6.56%) 9.20%
RATIOS & SUPPLEMENTAL DATA:
Ratios to average net assets:
Total expenses.................... 2.30% 2.48%++
Total expenses, excluding
indirectly paid expenses........ N/A N/A
Net investment income (loss)...... (0.63%) (1.64%)++
Portfolio turnover rate............ 137% 162%
Average commission rate paid per
share............................. N/A N/A
Net assets end of period
(thousands)....................... $9,900 $3,620
</TABLE>

| Calculated based on average shares outstanding throughout the period.
+ Initial sales charge or contingent deferred sales charge is not reflected.
++ Annualized.
* For the period from August 2, 1993 (date of initial public offering) to
December 31, 1993.
# The Fund changed its fiscal year end from December 31 to September 30,
effective September 30, 1997.
11

<PAGE>
EVERGREEN SMALL COMPANY GROWTH FUND -- CLASS B SHARES
<TABLE>
<CAPTION>
FOUR-MONTH
PERIOD ENDED
SEPTEMBER 30, YEAR ENDED MAY 31,
1997(A)(D) 1997(A) 1996 1995 1994 1993(A) 1992(A) 1991(A)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
PER SHARE DATA:
Net asset value beginning of
period..................... $8.44 $10.35 $8.62 $7.64 $7.95 $7.61 $7.17 $6.24
Income from investment
operations:
Net investment income
(loss)................... (0.04) (0.11) (0.13) (0.07) (0.12) (0.12) (0.08) (0.04)
Net realized and unrealized
gain (loss) on
investments and foreign
currency related
transactions............. 1.74 (0.78) 2.87 1.68 0.63 1.82 0.98 1.17
Total from investment
operations............. 1.70 (0.89) 2.74 1.61 0.51 1.70 0.90 1.13
Less distributions from:
Net investment income...... 0 0 0 0 0 0 0 0
Net realized gain on
investments and foreign
currency related
transactions............. (0.70) (1.02) (1.01) (0.63) (0.82) (1.36) (0.46) (0.20)
Total distributions...... (0.70) (1.02) (1.01) (0.63) (0.82) (1.36) (0.46) (0.20)
Net asset value end of
period..................... $9.44 $8.44 $10.35 $8.62 $7.64 $7.95 $7.61 $7.17
TOTAL RETURN (B)............ 21.43% (8.61%) 33.03% 23.58% 6.84% 28.76% 13.45% 19.42%
RATIOS & SUPPLEMENTAL DATA:
Ratios to average net
assets:
Total expenses............. 1.77%(c) 1.75% 1.73% 1.78% 1.73% 2.04% 1.47% 1.48%
Total expenses, excluding
indirectly paid
expenses................. 1.77%(c) 1.73% 1.72% N/A N/A N/A N/A N/A
Net investment income
(loss)................... (1.43%)(c) (1.32%) (1.34%) (1.10%) (1.49%) (1.68%) (1.09%) (0.68%)
Portfolio turnover rate..... 28% 48% 94% 38% 60% 78% 81% 73%
Average commission rate paid
per share.................. $0.0525 $0.0551 $0.0563 N/A N/A N/A N/A N/A
Net assets end of period
(millions)................. $1,546 $1,407 $2,006 $1,460 $1,006 $966 $702 $623
<CAPTION>

1990(A) 1989(A) 1988
<S> <C> <C> <C>
PER SHARE DATA:
Net asset value beginning of
period..................... $5.66 $4.48 $7.80
Income from investment
operations:
Net investment income
(loss)................... 0 0.02 0
Net realized and unrealized
gain (loss) on
investments and foreign
currency related
transactions............. 0.63 1.20 (1.64)
Total from investment
operations............. 0.63 1.22 (1.64)
Less distributions from:
Net investment income...... (0.05) (0.01) 0
Net realized gain on
investments and foreign
currency related
transactions............. 0 (0.03) (1.68)
Total distributions...... (0.05) (0.04) (1.68)
Net asset value end of
period..................... $6.24 $5.66 $4.48
TOTAL RETURN (B)............ 11.24% 27.45% (22.39%)
RATIOS & SUPPLEMENTAL DATA:
Ratios to average net
assets:
Total expenses............. 1.40% 1.27% 1.17%
Total expenses, excluding
indirectly paid
expenses................. N/A N/A N/A
Net investment income
(loss)................... 0.02% 0.47% 0.03%
Portfolio turnover rate..... 77% 57% 80%
Average commission rate paid
per share.................. N/A N/A N/A
Net assets end of period
(millions)................. $538 $504 $442
</TABLE>

(a) Calculation based on average shares outstanding.
(b) Excluding applicable sales charges.
(c) Annualized
(d) Effective September 30, 1997, the Fund changed its fiscal year end from May
31 to September 30.
12

<PAGE>
EVERGREEN STRATEGIC GROWTH FUND -- CLASS B SHARES
<TABLE>
<CAPTION>
ELEVEN-MONTH
PERIOD ENDED YEAR ENDED OCTOBER 31,
SEPTEMBER 30, 1997 (A)(D) 1996 1995 1994
<S> <C> <C> <C> <C>
PER SHARE DATA:
Net asset value beginning of period............................. $ 8.68 $ 8.05 $ 7.54 $ 9.00
Income from investment operations
Net investment income (loss)................................... 0.01 (0.04) (0.02) 0
Net realized and unrealized gain (loss) on investments
and foreign currency related transactions.................... 2.96 1.04 1.13 0.23
Total from investment operations............................. 2.97 1.00 1.11 0.23
Less distributions:
From net investment income..................................... 0 (0.01) 0 0
In excess of net investment income............................. 0 0 0 0
Net realized gain on investments and foreign currency related
transactions................................................... (1.04) (0.36) (0.60) (1.66)
In excess of net realized gain on investments and foreign
currency related transactions................................ 0 0 0 (0.03)
Total distributions.......................................... (1.04) (0.37) (0.60) (1.69)
Net asset value end of period................................... $ 10.61 $ 8.68 $ 8.05 $ 7.54
TOTAL RETURN (B)................................................ 37.74% 12.95% 15.05% 3.55%
RATIOS/SUPPLEMENTAL DATA
Ratios to average net assets:
Total expenses................................................. 1.19%(c) 1.91% 2.01% 1.73%
Total expenses, excluding indirectly paid expenses............. 1.18%(c) 1.90% 2.00% N/A
Net investment income (loss)................................... 0.12%(c) (0.48%) (0.25%) (0.17%)
Portfolio turnover rate......................................... 71% 156% 140% 68%
Average commission rate paid per share.......................... $0.0222 $0.0042 N/A N/A
Net assets end of period (millions)............................. $ 920 $ 497 $ 492 $ 417
<CAPTION>

1993
<S> <C>
PER SHARE DATA:
Net asset value beginning of period............................. $ 7.60
Income from investment operations
Net investment income (loss)................................... (0.06)
Net realized and unrealized gain (loss) on investments
and foreign currency related transactions.................... 1.89
Total from investment operations............................. 1.83
Less distributions:
From net investment income..................................... 0
In excess of net investment income............................. (0.03)
Net realized gain on investments and foreign currency related
transactions................................................... (0.40)
In excess of net realized gain on investments and foreign
currency related transactions................................ 0
Total distributions.......................................... (0.43)
Net asset value end of period................................... $ 9.00
TOTAL RETURN (B)................................................ 24.97%
RATIOS/SUPPLEMENTAL DATA
Ratios to average net assets:
Total expenses................................................. 1.83%
Total expenses, excluding indirectly paid expenses............. N/A
Net investment income (loss)................................... (0.57%)
Portfolio turnover rate......................................... 65%
Average commission rate paid per share.......................... N/A
Net assets end of period (millions)............................. $ 404
</TABLE>
<TABLE>
<CAPTION>
YEAR ENDED OCTOBER 31,
1992 1991 1990 1989 1988
<S> <C> <C> <C> <C> <C>
PER SHARE DATA:
Net asset value beginning of period......................................... $ 8.18 $ 6.52 $ 7.67 $ 6.53 $ 7.55
Income from investment operations
Net investment income (loss)............................................... (0.01) 0.08 0.08 0.16 0.18
Net realized and unrealized gain (loss) on investments
and foreign currency related transactions................................ 0.42 2.24 (0.80) 1.21 0.19
Total from investment operations......................................... 0.41 2.32 (0.72) 1.37 0.37
Less distributions:
From net investment income................................................. (0.01) (0.16) (0.18) (0.18) (0.14)
In excess of net investment income......................................... (0.05) 0 0 0 0
Net realized gain on investments and foreign currency related
transactions............................................................... (0.93) (0.50) (0.25) (0.05) (1.25)
In excess of net realized gain on investments and foreign currency
related transactions..................................................... 0 0 0 0 0
Total distributions...................................................... (0.99) (0.66) (0.43) (0.23) (1.39)
Net asset value end of period............................................... $ 7.60 $ 8.18 $ 6.52 $ 7.67 $ 6.53
TOTAL RETURN (B)............................................................ 6.38% 38.77% (10.05%) 21.74% 7.73%
RATIOS/SUPPLEMENTAL DATA
Ratios to average net assets:
Total expenses............................................................. 1.58% 1.52% 1.65% 1.59% 1.69%
Total expenses, excluding indirectly paid expenses......................... N/A N/A N/A N/A N/A
Net investment income (loss)............................................... (0.15%) 0.99% 1.64% 2.06% 2.14%
Portfolio turnover rate..................................................... 62% 86% 30% 40% 89%
Average commission rate paid per share...................................... N/A N/A N/A N/A N/A
Net assets end of period (millions)......................................... $ 322 $ 339 $ 234 $ 330 $ 328

1987
<S> <C>
PER SHARE DATA:
Net asset value beginning of period......................................... $ 9.13
Income from investment operations
Net investment income (loss)............................................... 0.02
Net realized and unrealized gain (loss) on investments
and foreign currency related transactions................................ 0.04
Total from investment operations......................................... 0.06
Less distributions:
From net investment income................................................. (0.13)
In excess of net investment income......................................... 0
Net realized gain on investments and foreign currency related
transactions............................................................... (1.51)
In excess of net realized gain on investments and foreign currency
related transactions..................................................... 0
Total distributions...................................................... (1.64)
Net asset value end of period............................................... $ 7.55
TOTAL RETURN (B)............................................................ 0.15%
RATIOS/SUPPLEMENTAL DATA
Ratios to average net assets:
Total expenses............................................................. 2.12%
Total expenses, excluding indirectly paid expenses......................... N/A
Net investment income (loss)............................................... 0.23%
Portfolio turnover rate..................................................... 104%
Average commission rate paid per share...................................... N/A
Net assets end of period (millions)......................................... $ 299
</TABLE>

<PAGE>
DESCRIPTION OF THE FUNDS
INVESTMENT OBJECTIVES AND POLICIES
Each Fund's investment objective is nonfundamental; as a result, a Fund
may change its objective without a shareholder vote. Each Fund has also adopted
certain fundamental investment policies which are mainly designed to limit a
Fund's exposure to risk. Each Fund's fundamental policies cannot be changed
without a shareholder vote. See the Statement of Additional Information ("SAI")
for more information regarding a Fund's fundamental investment policies or other
related investment policies. There can be no assurance that a Fund's investment
objective will be achieved.
EVERGREEN FUND
The EVERGREEN FUND seeks to achieve its investment objective of capital
appreciation principally through investments in common stock and securities
convertible into or exchangeable for common stock of companies which are
little-known, relatively small or represent special situations which, in the
opinion of the Fund's investment adviser, offer potential for capital
appreciation. A "little-known" company means one whose business is limited to a
regional market or whose securities are closely held with only a small
proportion traded publicly. A "relatively small" company means one which has a
small share of the market for its products or services in comparison with other
companies in its field, or which provides goods or services for a limited
market. A "special situation" company is one which offers potential for capital
appreciation because of a recent or anticipated change in structure, management,
products or services. In addition to the securities described above, the
EVERGREEN FUND may invest in securities of relatively well-known and large
companies with potential for capital appreciation. Investments may also be made
to a limited degree in non-convertible debt securities and preferred stocks
which offer an opportunity for capital appreciation. Short-term investments may
also be made if the Fund's investment adviser believes that such action will
benefit the Fund. See "Special Risk Considerations."
EVERGREEN MICRO CAP FUND
The investment objective of EVERGREEN MICRO CAP FUND is to achieve
capital appreciation; income is not a factor in the selection of portfolio
securities. The Fund seeks to achieve its objective principally through
investments in common stock of companies for which there is a relatively limited
trading market. A relatively limited trading market is one in which only small
amounts of stock are available at any given time generally through five or fewer
market makers. The securities of such companies are often traded only
over-the-counter or on a regional securities exchange, rarely on a national
securities exchange, and may not trade every day or in the volume typical of
trading on a national securities exchange.
Investments by the Fund are made with a view toward taking advantage of
market inefficiencies affecting the price of a company's securities or by
exploiting the investment opportunities which may be inherent in companies
offering new or unique products or services. Market inefficiency can result from
a company being too small to be covered by most industry analysts, thereby
resulting in a limited dissemination of information about the company or its
industry. The companies in which the Fund may invest are small, but have at
least $1,000,000 and generally no more than $150,000,000 of market
capitalization (see "Investment Practices and Restrictions -- Special Risk
Considerations"). The Fund may also invest in little-known or unpopular
companies which may not be widely recommended for purchase by industry analysts
due to some situation unique to the company or its industry. There are no
restrictions as to types of businesses or industries in which the Fund may
invest. The Fund's investment adviser believes that its investment research
programs will uncover a variety of relatively unexploited investment
opportunities.
The Fund's investment adviser will attempt to screen the universe of
companies falling within the capitalization range described above and invest
primarily in what it believes to be the 100 best based on certain qualitative
and quantitative criteria. Such companies may include those with the highest
return on equity and consistent earnings growth. The criteria will be reviewed
and evaluated on an ongoing basis by the Fund's investment adviser. In addition,
the Fund will invest in other companies which do not meet the screening
criteria.
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These will include companies which offer unique products or services or operate
in industries or sectors that have, in the opinion of the Fund's investment
adviser, significant growth prospects. In selecting investment opportunities for
the Fund, the Fund's investment adviser will use certain proprietary computer
screening techniques and the extensive library facilities of Lieber & Company,
the Fund's sub-adviser.
While the focus of EVERGREEN MICRO CAP FUND is on long-term capital
appreciation, investments may on occasion be made with the expectation of
short-term capital appreciation. Securities held for a short time period may be
sold if the investment objective for such securities has been achieved or if
other circumstances warrant.
EVERGREEN AGGRESSIVE GROWTH FUND
The EVERGREEN AGGRESSIVE GROWTH FUND'S investment objective is to achieve
long-term capital appreciation by investing primarily in common stocks of
emerging growth companies and larger, more well established companies, all of
which are viewed by the Fund's investment adviser as having above-average
appreciation potential. Under normal circumstances, the Fund intends to invest
at least 65% of its net assets in common stocks or securities convertible into
common stocks. The Fund's investment adviser considers an emerging growth
company to be one which is still in the developmental stage, yet has
demonstrated, or is expected to achieve, growth of earnings over various major
business cycles. Important qualities of any emerging growth company include
sound management and a good product with growing market opportunities. To the
extent that its assets are not invested in common stocks or securities
convertible into common stocks, the Fund also may invest its assets in, or enter
into repurchase agreements with banks or broker-dealers with respect to,
investment grade corporate bonds, United States ("U.S.") government securities,
commercial paper and certificates of deposit of domestic banks.
Consistent with its investment objective, the Fund also may invest in
equity securities of seasoned, established companies which its investment
adviser believes have above-average appreciation potential similar to that of
companies in the developmental stage. This may be due, for example, to
management change, new technology, new product or service developments, changes
in demand, or other factors. Investments in stocks of emerging growth companies
may involve special risks. See "Special Risk Considerations."
EVERGREEN OMEGA FUND
The investment objective of EVERGREEN OMEGA FUND is to seek maximum
capital growth by investing in a varied portfolio consisting primarily of common
stocks and securities convertible into common stocks. The Fund pursues its
objective by employing techniques of the fully managed-investment concept,
meaning that the Fund's investment adviser will continuously review both
individual securities and relevant general conditions. Whenever, in the opinion
of the Fund's investment adviser, a security no longer seems to have the
required characteristics, an anticipated level of performance has been achieved,
or other securities present relatively greater opportunities for realizing the
Fund's objective, appropriate changes will be made in the Fund's portfolio. The
Fund's equity position will be changed as the investment adviser changes its
evaluation of trends in general securities price levels. Portfolio turnover rate
will not be considered a limiting factor in the execution of investment
decisions.
EVERGREEN SMALL COMPANY GROWTH FUND
EVERGREEN SMALL COMPANY GROWTH FUND invests at least 65% of its total
assets in equity securities of companies with small market capitalizations. For
this purpose, companies with small market capitalizations are generally those
with market capitalizations of less than $1 billion ("small cap") at the time of
the Fund's investment. Companies whose capitalization falls outside this range
after the purchase continue to be considered small cap for this purpose.
While the Fund focuses on small cap stocks, it may also invest in other
types of securities without regard to the market capitalization of the issuer
and which may be listed on national exchanges or traded over-the-counter,
including other common stocks, debt securities convertible into common stocks or
having common stock characteristics, and rights and warrants to purchase common
stocks. While income is not an objective, securities appearing to offer
attractive possibilities for future growth of income may be included in the
portfolio whenever it seems possible to do so without conflicting with the
Fund's objective of capital growth.
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EVERGREEN STRATEGIC GROWTH FUND
EVERGREEN STRATEGIC GROWTH FUND'S investment objective is to provide
shareholders with growth of capital. In pursuing its objective, the Fund invests
in common stocks, debt securities, including debt securities convertible or
exchangeable for preferred or common stock, and rights and warrants to purchase
such stocks and securities that it considers to be consistent with an investment
objective of capital growth. When appropriate, the Fund increases the quality of
its investments to resist downward market movements.
Other Eligible Securities. Each Fund may invest, for temporary defensive
purposes, up to 100% of their assets in short-term obligations. Such obligations
may include U.S. government securities, master demand notes, commercial paper
notes, bank deposits and other financial obligations.
EVERGREEN SMALL COMPANY GROWTH FUND and EVERGREEN STRATEGIC GROWTH FUND
may invest in limited partnerships, including master limited partnerships.
EVERGREEN OMEGA FUND, EVERGREEN SMALL COMPANY GROWTH FUND and EVERGREEN
STRATEGIC GROWTH FUND may invest in foreign securities, however, EVERGREEN OMEGA
FUND and EVERGREEN SMALL COMPANY GROWTH FUND may invest up to 25% of their
assets in such securities.
EVERGREEN OMEGA FUND may invest, for temporary defensive purposes,
without limit in investment grade bonds or debentures rated by Moody's Investors
Service ("Moody's") as Baa or better or by Standard & Poor's Ratings Group
("S&P") as BBB or better or those having at least similar quality in the
investment adviser's judgment. The Fund may also invest in non-convertible
preferred stocks of companies considered creditworthy and able to sustain
dividend payments and in short-term money market instruments maturing in one
year or less.
In addition to the investment policies detailed above, each Fund may
employ certain additional investment strategies which are discussed in
"Investment Practices and Restrictions."
INVESTMENT PRACTICES AND RESTRICTIONS
Repurchase Agreements. The Funds may invest in repurchase agreements. A
repurchase agreement is an agreement by which a Fund purchases a security
(usually U.S. government securities) for cash and obtains a simultaneous
commitment from the seller (usually a bank or broker/dealer) to repurchase the
security at an agreed-upon price and specified future date. The repurchase price
reflects an agreed-upon interest rate for the time period of the agreement. The
Fund's risk is the inability of the seller to pay the agreed-upon price on the
delivery date. However, this risk is tempered by the ability of the Fund to sell
the security in the open market in the case of a default. In such a case, the
Fund may incur costs in disposing of the security which would increase Fund
expenses. The Fund's investment adviser will monitor the creditworthiness of the
firms with which the Fund enters into repurchase agreements.
Reverse Repurchase Agreements. The Funds may enter into reverse repurchase
agreements. A reverse repurchase agreement is an agreement by a Fund to sell a
security and repurchase it at a specified time and price. The Fund could lose
money if the market values of the securities it sold decline below their
repurchase prices. Reverse repurchase agreements may be considered a form of
borrowing, and, therefore, a form of leverage. Leverage may magnify gains or
losses of the Fund.
When-Issued, Delayed-Delivery and Forward Commitment Transactions. Each Fund may
enter into transactions whereby it commits to buying a security, but does not
pay for or take delivery of the security until some specified date in the
future. The value of these securities is subject to market fluctuation during
this period and no income accrues to a Fund until settlement. At the time of
settlement, a when-issued security may be valued at less than its purchase
price. When entering into these transactions, the Fund relies on the other party
to consummate the transaction; if the other party fails to do so, the Fund may
be disadvantaged.
Securities Lending. To generate income and offset expenses, each Fund may lend
securities to broker-dealers and other financial institutions. Loans of
securities by a Fund may not exceed 30% of the value of the Fund's total assets.
While securities are on loan, the borrower will pay the Fund any income accruing
on the security. Also, the Fund may invest any collateral it receives in
additional securities. Gains or losses in the market value of a lent security
will affect the Fund and its shareholders. When the Fund lends its securities,
it runs the risk that it could not retrieve the securities on a timely basis
possibly losing the opportunity to sell the securities at a desirable price.
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Also, if the borrower files for bankruptcy or becomes insolvent, the Fund's
ability to dispose of the securities may be delayed.
Investing in Securities of Other Investment Companies. Each Fund may invest in
the securities of other investment companies. As a shareholder of another
investment company, the Fund would pay its portion of the other investment
company's expenses. These expenses would be in addition to the expenses that the
Fund currently bears concerning its own operations and may result in some
duplication of fees.
Borrowing. Each Fund may borrow from banks in an amount up to 33 1/3% of its
total assets, taken at market value. Each Fund may also borrow an additional 5%
of its total assets from banks and others. A Fund may only borrow as a temporary
measure for extraordinary or emergency purposes such as the redemption of Fund
shares. A Fund will not purchase securities while borrowings are outstanding
except to exercise prior commitments and to exercise subscription rights. The
Funds do not intend to leverage.
Illiquid Securities. Each Fund may invest up to 15% of its net assets in
illiquid securities and other securities which are not readily marketable.
Repurchase agreements with maturities longer than seven days will be included
for the purpose of the foregoing 15% limit. The inability of a Fund to dispose
of illiquid investments readily or at a reasonable price could impair the Fund's
ability to raise cash for redemptions or other purposes.
Restricted Securities. Each Fund may invest in restricted securities, including
securities eligible for resale pursuant to Rule 144A under the Securities Act of
1933 (the "1933 Act"). Generally, Rule 144A establishes a safe harbor from the
registration requirements of the 1933 Act for resale by large institutional
investors of securities not publicly traded in the U.S. Each Fund's investment
adviser determines the liquidity of Rule 144A securities according to guidelines
and procedures adopted by Evergreen Equity Trust's Board of Trustees. The Board
of Trustees monitors the investment adviser's application of those guidelines
and procedures. Securities eligible for resale pursuant to Rule 144A, which the
Fund's investment adviser has determined to be liquid or readily marketable, are
not subject to the 15% limit on illiquid securities.
Options and Futures. The Funds may engage in options and futures transactions.
Options and futures transactions are intended to enable a Fund to manage market,
interest rate or exchange rate risk. The Funds do not use these transactions for
speculation or leverage.
The Funds may attempt to hedge all or a portion of their portfolios
through the purchase of both put and call options on their portfolio securities
and listed put options on financial futures contracts for portfolio securities.
The Funds may also purchase call options on financial futures contracts. The
Funds may write covered call options on their portfolio securities to attempt to
increase their current income. The Funds will maintain their positions in
securities, option rights, and segregated cash subject to puts and calls until
the options are exercised, closed, or have expired. An option position may be
closed out only on an exchange which provides a secondary market for an option
of the same series.
The Funds may write (i.e., sell) covered call and put options. By writing
a call option, a Fund becomes obligated during the term of the option to deliver
the securities underlying the option upon payment of the exercise price. By
writing a put option, a Fund becomes obligated during the term of the option to
purchase the securities underlying the option at the exercise price if the
option is exercised. The Funds also may write straddles (combinations of covered
puts and calls on the same underlying security). The Funds may only write
"covered" options. This means that so long as a Fund is obligated as the writer
of a call option, it will own the underlying securities subject to the option
or, in the case of call options on U.S. Treasury bills, the Fund might own
substantially similar U.S. Treasury bills. A Fund will be considered "covered"
with respect to a put option it writes if, so long as it is obligated as the
writer of the put option, it deposits and maintains with its custodian in a
segregated account liquid assets having a value equal to or greater than the
exercise price of the option.
The principal reason for writing call or put options is to obtain,
through a receipt of premiums, a greater current return than would be realized
on the underlying securities alone. The Funds receive a premium from writing a
call or put option which they retain whether or not the option is exercised. By
writing a call option, the Funds might lose the potential for gain on the
underlying security while the option is open, and by writing a put option the
Funds might become obligated to purchase the underlying securities for more than
their current market price upon exercise.
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A futures contract is a firm commitment by two parties: the seller, who
agrees to make delivery of the specific type of instrument called for in the
contract ("going short"), and the buyer, who agrees to take delivery of the
instrument ("going long") at a certain time in the future. Financial futures
contracts call for the delivery of particular debt instruments issued or
guaranteed by the U.S. Treasury or by specified agencies or instrumentalities of
the U.S. government. If a Fund enters into financial futures contracts directly
to hedge its holdings of fixed income securities, it would enter into contracts
to deliver securities at an undetermined price (i.e., "go short") to protect
itself against the possibility that the prices of its fixed income securities
may decline during the Fund's anticipated holding period. A Fund would agree to
purchase securities in the future at a predetermined price (i.e., "go long") to
hedge against a decline in market interest rates.
The Funds may also enter into currency and other financial futures
contracts and write options on such contracts. The Funds intend to enter into
such contracts and related options for hedging purposes. The Funds will enter
into futures on securities, currencies, or index-based futures contracts in
order to hedge against changes in interest or exchange rates or securities
prices. A futures contract on securities or currencies is an agreement to buy or
sell securities or currencies during a designated month at whatever price exists
at that time. A futures contract on a securities index does not involve the
actual delivery of securities, but merely requires the payment of a cash
settlement based on changes in the securities index. The Funds do not make
payment or deliver securities upon entering into a futures contract. Instead,
they put down a margin deposit, which is adjusted to reflect changes in the
value of the contract and which remains in effect until the contract is
terminated.
The Funds may sell or purchase currency and other financial futures
contracts. When a futures contract is sold by a Fund, the profit on the contract
will tend to rise when the value of the underlying securities or currencies
declines and to fall when the value of such securities or currencies increases.
Thus, the Funds sell futures contracts in order to offset a possible decline in
the profit on their securities or currencies. If a futures contract is purchased
by a Fund, the value of the contract will tend to rise when the value of the
underlying securities or currencies increases and to fall when the value of such
securities or currencies declines.
The Funds may enter into closing purchase and sale transactions in order
to terminate a futures contract and may buy or sell put and call options for the
purpose of closing out their options positions. The Funds' ability to enter into
closing transactions depends on the development and maintenance of a liquid
secondary market. There is no assurance that a liquid secondary market will
exist for any particular contract or at any particular time. As a result, there
can be no assurance that the Funds will be able to enter into an offsetting
transaction with respect to a particular contract at a particular time. If the
Funds are not able to enter into an offsetting transaction, the Funds will
continue to be required to maintain the margin deposits on the contract and to
complete the contract according to its terms, in which case they would continue
to bear market risk on the transaction.
Risk Characteristics of Options and Futures. Although options and futures
transactions are intended to enable the Funds to manage market, exchange, or
interest rate risks, these investment devices can be highly volatile, and the
Funds' use of them can result in poorer performance (i.e., the Funds' returns
may be reduced). The Funds' attempt to use such investment devices for hedging
purposes may not be successful. Successful futures strategies require the
ability to predict future movements in securities prices, interest rates and
other economic factors. When the Funds use financial futures contracts and
options on financial futures contracts as hedging devices, there is a risk that
the prices of the securities subject to the financial futures contracts and
options on financial futures contracts may not correlate perfectly with the
prices of the securities in the Funds' portfolios. This may cause the financial
futures contracts and any related options to react to market changes differently
than the portfolio securities. In addition, a Fund's investment adviser could be
incorrect in its expectations and forecasts about the direction or extent of
market factors, such as interest rates, securities price movements, and other
economic factors. Even if a Fund's investment adviser correctly predicts
interest rate movements, a hedge could be unsuccessful if changes in the value
of a Fund's futures position did not correspond to changes in the value of its
investments. In these events, the Fund may lose money on the financial futures
contracts or the options on financial futures contracts. It is not certain that
a secondary market for positions in financial futures contracts or for options
on financial futures contracts will exist at all times. Although a Fund's
investment adviser will consider liquidity before entering into financial
futures contracts or options on financial futures contracts, there is no
assurance that a liquid secondary market on an exchange will exist for any
particular financial futures contract or option on a financial futures contract
at any particular time. The Funds' ability to establish and close out financial
futures contracts and options on financial futures contract positions depends on
this secondary market. If a Fund is unable to close out its position
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due to disruptions in the market or lack of liquidity, the Fund may lose money
on the futures contract or option, and the losses to the Fund could be
significant.
Derivatives. Derivatives are financial contracts, such as those described above,
whose value is based on an underlying asset, such as a stock or a bond, or an
underlying economic factor, such as an index or an interest rate.
The Funds may invest in derivatives only if the expected risks and
rewards are consistent with their objectives and policies.
Losses from derivatives can sometimes be substantial. This is true partly
because small price movements in the underlying asset can result in immediate
and substantial gains or losses in the value of the derivative. Derivatives can
also cause a Fund to lose money if the Fund fails to correctly predict the
direction in which the underlying asset or economic factor will move.
Investment in Small Companies. Investments in securities of little-known,
relatively small and special situation companies may tend to be speculative and
volatile. A lack of management depth in such companies could increase the risks
associated with the loss of key personnel. Also, the material and financial
resources of such companies may be limited, with the consequence that funds or
external financing necessary for growth may be unavailable. Such companies may
also be involved in the development or marketing of new products or services for
which there are no established markets. If projected markets do not materialize
or only regional markets develop, such companies may be adversely affected or
may be subject to the consequences of local events. Moreover, such companies may
be insignificant factors in their industries and may become subject to intense
competition from larger companies. Securities of companies in which the Funds
may invest will frequently be traded only in the over-the-counter market or on
regional stock exchanges and will often be closely held. Securities of this type
may have limited liquidity and may be subject to wide price fluctuations. As a
result of the risk factors described above, the net asset value of each Fund's
shares can be expected to vary significantly. Accordingly, each Fund should not
be considered suitable for investors who are unable or unwilling to assume the
associated risks, nor should investment in the Funds be considered a balanced or
complete investment program.
Foreign Investments. Foreign securities may involve additional risks.
Specifically, they may be affected by the strength of foreign currencies
relative to the U.S. dollar, or by political or economic developments in foreign
countries. Accounting procedures and government supervision may be less
stringent than those applicable to U.S. companies. There may be less publicly
available information about a foreign company than about a U.S. company. Foreign
markets may be less liquid or more volatile than U.S. markets and may offer less
protection to investors. It may also be more difficult to enforce contractual
obligations abroad than would be the case in the U.S. because of differences in
the legal systems. Foreign securities may be subject to foreign taxes, which may
reduce yield, and may be less marketable than comparable U.S. securities. All
these factors are considered by the investment adviser of EVERGREEN OMEGA FUND,
EVERGREEN SMALL COMPANY GROWTH FUND and EVERGREEN STRATEGIC GROWTH FUND before
making any of these types of investments.
Foreign Currency Transactions. As discussed above, EVERGREEN OMEGA FUND,
EVERGREEN SMALL COMPANY GROWTH FUND and EVERGREEN STRATEGIC GROWTH FUND may
invest in securities of foreign issuers. When the Funds invest in foreign
securities, they usually will be denominated in foreign currencies, and the
Funds temporarily may hold funds in foreign currencies. Thus, the value of Fund
shares will be affected by changes in exchange rates.
As one way of managing exchange rate risk, in addition to entering into
currency futures contracts, the Funds may enter into forward currency exchange
contracts (agreements to purchase or sell currencies at a specified price and
date). The exchange rate for the transaction (the amount of currency the Funds
will deliver or receive when the contract is completed) is fixed when the Funds
enter into the contract. The Funds usually will enter into these contracts to
stabilize the U.S. dollar value of a security they have agreed to buy or sell.
The Funds intend to use these contracts to hedge the U.S. dollar value of a
security they already own, particularly if the Funds expect a decrease in the
value of the currency in which the foreign security is denominated. Although the
Funds will attempt to benefit from using forward contracts, the success of their
hedging strategy will depend on the investment adviser's ability to predict
accurately the future exchange rates between foreign currencies and the U.S.
dollar. The value of the Funds' investments denominated in foreign currencies
will depend on the relative strength of those currencies and the U.S. dollar,
and the Funds may be affected favorably or unfavorably by changes in the
exchange rates or exchange control regulations between foreign currencies and
the U.S. dollar. Changes in foreign
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currency exchange rates also may affect the value of dividends and interest
earned, gains and losses realized on the sale of securities and net investment
income and gains, if any, to be distributed to shareholders by the Funds.
Although the Funds do not currently intend to do so, they may also purchase and
sell options related to foreign currencies. The Funds do not intend to enter
into foreign currency transactions for speculation or leverage.
ORGANIZATION AND SERVICE PROVIDERS
ORGANIZATION
Fund Structure. Each Fund is an investment pool, which invests shareholders'
money toward a specified goal. In technical terms, each Fund is a diversified
series of an open-end, management investment company, called Evergreen Equity
Trust (the "Trust"). The Trust is a Delaware business trust organized on
September 17, 1997.
Board of Trustees. The Trust is supervised by a Board of Trustees that is
responsible for representing the interests of shareholders. The Trustees meet
periodically throughout the year to oversee each Fund's activities, reviewing,
among other things, each Fund's performance and its contractual arrangements
with various service providers.
Shareholder Rights. All shareholders of a given class participate equally in
dividends and distributions from a Fund's assets and have equal liquidation and
other rights. Shareholders may exchange shares as described under "Exchanges,"
but will have no other preference, conversion, exchange or preemptive rights.
When issued and paid for, shares will be fully paid and nonassessable. Shares of
the Funds are redeemable, transferable and freely assignable as collateral. The
Funds may establish additional classes or series of shares.
The Funds do not hold annual shareholder meetings; a Fund may, however,
hold special meetings for such purposes as electing or removing Trustees,
changing fundamental policies and approving investment advisory agreements or
12b-1 plans. In addition, the Funds are prepared to assist shareholders in
communicating with one another for the purpose of convening a meeting to elect
Trustees. If any matters are to be voted on by shareholders, each share owned as
of the record date for the meeting would be entitled to one vote for each dollar
of net asset value applicable to each share.
SERVICE PROVIDERS
Investment Advisers. The investment adviser of EVERGREEN FUND and EVERGREEN
MICRO CAP FUND is Evergreen Asset Management Corp. ("Evergreen Asset"), which is
a wholly-owned subsidiary of First Union Corporation ("First Union"). Evergreen
Asset, with its predecessors, has served as investment adviser to the Evergreen
mutual funds since 1971.
Evergreen Asset is entitled to receive from EVERGREEN FUND and EVERGREEN
MICRO CAP FUND an annual fee equal to 1.00% of average daily net assets of each
Fund on the first $750,000,000, plus 0.90% of average daily net assets on the
next $250,000,000, plus 0.80% of average daily net assets on assets over
$1,000,000,000.
The Capital Management Group of First Union National Bank ("CMG") serves
as investment adviser to EVERGREEN AGGRESSIVE GROWTH FUND.
CMG receives an annual fee from EVERGREEN AGGRESSIVE GROWTH FUND equal to
0.60% of average daily net assets of the Fund.
The investment adviser to each of EVERGREEN OMEGA FUND, EVERGREEN SMALL
COMPANY GROWTH FUND and EVERGREEN STRATEGIC GROWTH FUND is Keystone Investment
Management Company ("Keystone"). Keystone has provided investment advisory and
management services to investment companies and private accounts since it was
organized in 1932. Keystone is an indirect subsidiary of First Union National
Bank ("FUNB"). FUNB is a subsidiary of First Union. Both FUNB and First Union
are located at 201 South College Street, Charlotte, North Carolina 28288-0630.
First Union and its subsidiaries provide a broad range of financial services to
individuals and businesses throughout the United States.
EVERGREEN OMEGA FUND pays Keystone a fee, calculated on an annual basis,
equal to 0.75% of the first $250,000,000 of average daily net assets, plus
0.675% of the next $250,000,000 of average daily net assets, plus
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0.60% of the next $500,000,000 of average daily net assets, plus 0.50% of
amounts over $1,000,000,000 of average daily net assets, computed as of the
close of business each business day and paid monthly.
EVERGREEN SMALL COMPANY GROWTH FUND and EVERGREEN STRATEGIC GROWTH FUND
each pay Keystone a fee, calculated on an annual basis, equal to 0.70% of the
first $100,000,000 of the aggregate net asset value of the shares of the Fund,
plus 0.65% of the next $100,000,000, plus 0.60% of the next $100,000,000, plus
0.55% of the next $100,000,000, plus 0.50% of the next $100,000,000, plus 0.45%
of the next $500,000,000, plus 0.40% of the next $500,000,000, plus 0.35% of
amounts over $1,500,000,000, computed as of the close of business each business
day and paid monthly.
Portfolio Managers. The portfolio manager for EVERGREEN FUND is Stephen A.
Lieber, who is Chairman and Co-Chief Executive of Evergreen Asset. Mr. Lieber is
the founder of Evergreen Asset and has been associated with Evergreen Asset and
its predecessor since 1971.
The portfolio manager for EVERGREEN AGGRESSIVE GROWTH FUND is Harold J.
Ireland, Jr., a Vice President of CMG who has been associated with CMG since
1995. Prior to that, Mr. Ireland was at Palm Beach Capital Management, Inc. and
served as portfolio manager of the Fund's predecessor, ABT Emerging Growth Fund,
since 1985.
The portfolio of EVERGREEN MICRO CAP FUND is managed by a committee,
which includes Stephen A. Lieber and Nola Maddox Falcone, President and Co-Chief
Executive Officer of Evergreen Asset, together with portfolio management and
analytical personnel employed by Evergreen Asset or its affiliates.
Maureen E. Cullinane has been EVERGREEN OMEGA FUND'S portfolio manager
since 1989 and EVERGREEN STRATEGIC GROWTH FUND'S portfolio manager since 1985.
Ms. Cullinane is a Keystone Senior Vice President and Senior Portfolio Manager
and has more than 20 years of investment experience.
The portfolio manager of EVERGREEN SMALL COMPANY GROWTH FUND is J. Gary
Craven, who joined Keystone in November, 1996. Mr. Craven is currently a
Keystone Senior Vice President, Chief Investment Officer and Group Leader for
the small cap equity area. Prior to joining Keystone, Mr. Craven was a portfolio
manager at Invista Capital Management, Inc. since 1987.
Sub-adviser. Evergreen Asset has entered into sub-advisory agreements with
Lieber & Company, an indirect wholly-owned subsidiary of First Union, which
provide that Lieber & Company's research department and staff will furnish
Evergreen Asset with information, investment recommendations, advice and
assistance, and will generally be available for consultation on the portfolios
of EVERGREEN FUND and EVERGREEN MICRO CAP FUND. Lieber & Company will be
reimbursed by Evergreen Asset in connection with the rendering of services on
the basis of the direct and indirect costs of performing such service. There is
no additional charge to the Funds for the services provided by Lieber & Company.
Transfer Agent and Dividend Disbursing Agent. Evergreen Service Company ("ESC"),
200 Berkeley Street, Boston, Massachusetts 02116, acts as the Funds' transfer
agent and dividend disbursing agent. ESC is an indirect, wholly-owned subsidiary
of First Union.
Custodian. State Street Bank and Trust Company, P.O. Box 9021, Boston,
Massachusetts 02205-9827 acts as the Funds' custodian.
Principal Underwriter. Evergreen Distributor, Inc. ("EDI"), a subsidiary of The
BISYS Group, Inc., located at 125 West 55th Street, New York, New York 10019, is
the principal underwriter of the Funds.
21

<PAGE>
Administrator. Evergreen Investment Services, Inc. ("EIS") serves as
administrator to EVERGREEN AGGRESSIVE GROWTH FUND. As administrator, and subject
to the supervision and control of the Trust's Board of Trustees, EIS provides
the Fund with facilities, equipment and personnel. For its services as
administrator, EIS is entitled to receive a fee based on the aggregate average
daily net assets of the Fund at a rate based on the total assets of all mutual
funds advised by First Union subsidiaries. The administration fee is calculated
in accordance with the following schedule.
<TABLE>
<CAPTION>
Administration Fee
<C> <S>
0.050% on the first $7 billion
0.035% on the next $3 billion
0.030% on the next $5 billion
0.020% on the next $10 billion
0.015% on the next $5 billion
0.010% on assets in excess of $30 billion
</TABLE>

DISTRIBUTION PLANS AND AGREEMENTS
Distribution Plans. Each Fund's Class A, Class B and Class C shares pay for the
expenses associated with the distribution of such shares according to
distribution plans adopted pursuant to Rule 12b-1 under the Investment Company
Act of 1940 (the "1940 Act") (each a "Plan" or collectively the "Plans"). Under
the Plans, each Fund may incur distribution-related and shareholder
servicing-related expenses which are based upon a maximum annual rate as a
percentage of a Fund's average daily net assets attributable to the class, as
follows:
<TABLE>
<S> <C>
Class A shares 0.75% (currently limited to 0.25%)
Class B shares 1.00%
Class C shares 1.00%
</TABLE>

Of the amount that each class may pay under its respective Plan, up to
0.25% may constitute a service fee to be used to compensate organizations, which
may include each Fund's investment adviser or their affiliates, for personal
services rendered to shareholders and/or the maintenance of shareholder
accounts. The Funds may not pay any distribution or services fee during any
fiscal period in excess of the amounts set forth above. Amounts paid under the
Distribution Plans are used to compensate the Funds' distributor pursuant to the
Distribution Agreements entered into by each Fund.
Distribution Agreements. Each Fund has also entered into distribution agreements
(each a "Distribution Agreement" or collectively the "Distribution Agreements")
with EDI. Pursuant to the Distribution Agreements, each Fund will compensate EDI
for its services as distributor based upon the maximum annual rate as a
percentage of a Fund's average daily net assets attributable to the class, as
follows:
<TABLE>
<S> <C>
Class A shares 0.25%
Class B shares 1.00%
Class C shares 1.00%
</TABLE>

The Distribution Agreements provide that EDI will use the distribution
fee received from each Fund for payments (1) to compensate broker-dealers or
other persons for distributing shares of a Fund, including interest and
principal payments made in respect of amounts paid to broker-dealers or other
persons that have been financed (EDI may assign its rights to receive
compensation under the Plans to secure such financings), (2) to otherwise
promote the sale of shares of a Fund, and (3) to compensate broker-dealers,
depository institutions and other financial intermediaries for providing
administrative, accounting and other services with respect to a Fund's
shareholders. FUNB or its affiliates may finance the payments made by EDI to
compensate broker-dealers or other persons for distributing shares of a Fund.
In the event a Fund acquires the assets of other mutual funds,
compensation paid to EDI under the Distribution Agreements may be paid by EDI to
the distributors of the acquired funds or their predecessors.
Since EDI's compensation under the Distribution Agreements is not
directly tied to the expenses incurred by EDI, the amount of compensation
received by EDI under the Distribution Agreements during any year may be more or
less than its actual expenses and may result in a profit to EDI. Distribution
expenses incurred by EDI in one
22

<PAGE>
fiscal year that exceed the level of compensation paid to EDI for that year may
be paid from distribution fees received from a Fund in subsequent fiscal years.
PURCHASE AND REDEMPTION OF SHARES
HOW TO BUY SHARES
You may purchase shares of any Fund through broker-dealers, banks or
other financial intermediaries, or directly through EDI. In addition, you may
purchase shares of a Fund by mailing to the Fund, c/o ESC, P.O. Box 2121,
Boston, Massachusetts 02106-2121, a completed application and a check payable to
the Fund. You may also telephone 1-800-343-2898 to obtain the number of an
account to which you can wire or electronically transfer funds and then send in
a completed application. The minimum initial investment is $1,000, which may be
waived in certain situations. Subsequent investments in any amount may be made
by check, by wiring federal funds, by direct deposit or by an electronic funds
transfer.
There is no minimum amount for subsequent investments. Investments of $25
or more are allowed under the Systematic Investment Plan. See the application
for more information. Only Class A, Class B and Class C shares are offered
through this prospectus. (See "General Information -- Other Classes of Shares.")
Class A Shares -- Front-End Sales Charge Alternative. You may purchase Class A
shares at net asset value plus an initial sales charge on purchases under
$1,000,000. You may purchase $1,000,000 or more of Class A shares without a
front-end sales charge; however, a contingent deferred sales charge ("CDSC")
equal to the lesser of 1% of the purchase price or the redemption value will be
imposed on shares redeemed during the month of purchase and the 12-month period
following the month of purchase. The schedule of charges for Class A shares is
as follows:
<TABLE>
<CAPTION>
As a % of the
As a % of the Net Offering Commission to Dealer/Agent
Amount of Purchase Amount Invested Price as a % of Offering Price
<S> <C> <C> <C>
Less than $ 50,000 4.99% 4.75% 4.25%
$ 50,000 - $ 99,999 4.71% 4.50% 4.25%
$ 100,000 - $249,999 3.90% 3.75% 3.25%
$ 250,000 - $499,999 2.56% 2.50% 2.00%
$ 500,000 - $999,999 2.04% 2.00% 1.75%
$1,000,000 or more None None 1.00% of the amount invested up to
$2,999,999; .50% of the amount invested over
$2,999,999, up to $4,999,999; and .25% of
the excess over $4,999,999
</TABLE>

No front-end sales charges are imposed on Class A shares purchased by (a)
institutional investors, which may include bank trust departments and registered
investment advisers; (b) investment advisers, consultants or financial planners
who place trades for their own accounts or the accounts of their clients and who
charge such clients a management, consulting, advisory or other fee; (c) clients
of investment advisers or financial planners who place trades for their own
accounts if the accounts are linked to the master account of such investment
advisers or financial planners on the books of the broker-dealer through whom
shares are purchased; (d) institutional clients of broker-dealers, including
retirement and deferred compensation plans and the trusts used to fund these
plans, which place trades through an omnibus account maintained with a Fund by
the broker-dealer; (e) shareholders of record on October 12, 1990 in any series
of Evergreen Investment Trust in existence on that date, and the members of
their immediate families; (f) current and retired employees of FUNB and its
affiliates, EDI
23

<PAGE>
and any broker-dealer with whom EDI has entered into an agreement to sell shares
of the Funds, and members of the immediate families of such employees; (g) and
upon the initial purchase of an Evergreen fund by investors reinvesting the
proceeds from a redemption within the preceding 30 days of shares of other
mutual funds, provided such shares were initially purchased with a front-end
sales charge or subject to a CDSC. Certain broker-dealers or other financial
institutions may impose a fee on transactions in shares of the Funds.
Class A shares may also be purchased at net asset value by corporate or
certain other qualified retirement plans or a non-qualified deferred
compensation plan or a Title I tax sheltered annuity or TSA plan sponsored by an
organization having 100 or more eligible employees, or a TSA plan sponsored by a
public education entity having 5,000 or more eligible employees.
In connection with sales made to plans of the type described in the
preceding sentence EDI will pay broker-dealers and others concessions at the
rate of 0.50% of the net asset value of the shares purchased. These payments are
subject to reclaim in the event the shares are redeemed within twelve months
after purchase.
When Class A shares are sold, EDI will normally retain a portion of the
applicable sales charge and pay the balance to the broker-dealer or other
financial intermediary through whom the sale was made. EDI may also pay fees to
banks from sales charges for services performed on behalf of the customers of
such banks in connection with the purchase of shares of a Fund. In addition to
compensation paid at the time of sale, entities whose clients have purchased
Class A shares may receive a trailing commission equal to 0.25% of the average
daily net asset value on an annual basis of Class A shares held by their
clients. Certain purchases of Class A shares may qualify for reduced sales
charges in accordance with a Fund's Concurrent Purchases, Rights of
Accumulation, Letters of Intent, certain Retirement Plans and Reinstatement
Privilege. Consult the application for additional information concerning these
reduced sales charges.
Class B Shares -- Deferred Sales Charge Alternative. You may purchase Class B
shares at net asset value without an initial sales charge. However, you may pay
a CDSC if you redeem shares within six years after the month of purchase. The
amount of the CDSC (expressed as a percentage of the lesser of the current net
asset value or original cost) will vary according to the number of years from
the month of purchase of Class B shares as set forth below.
<TABLE>
<CAPTION>
CDSC
Redemption Timing Imposed
<S> <C>
Month of purchase and the first twelve-month period following the month of purchase............................... 5.00%
Second twelve-month period following the month of purchase........................................................ 4.00%
Third twelve-month period following the month of purchase......................................................... 3.00%
Fourth twelve-month period following the month of purchase........................................................ 3.00%
Fifth twelve-month period following the month of purchase......................................................... 2.00%
Sixth twelve-month period following the month of purchase......................................................... 1.00%
No CDSC is imposed on amounts redeemed thereafter.
</TABLE>
If you redeem shares purchased after January 1, 1995 but before January
9, 1998 you will pay a CDSC according to the CDSC schedule in effect at the time
you bought your shares.
The CDSC is deducted from the amount of the redemption and is paid to
EDI. In the event a Fund acquires the assets of other mutual funds, the CDSC may
be paid by EDI to the distributors of the acquired funds. Class B shares are
subject to higher distribution and/or shareholder service fees than Class A
shares for a period of seven years after the month of purchase (after which it
is expected that they will convert to Class A shares without imposition of a
front-end sales charge). The higher fees mean a higher expense ratio, so Class B
shares pay correspondingly lower dividends and may have a lower net asset value
than Class A shares. A Fund will not normally accept any purchase of Class B
shares in the amount of $250,000 or more.
At the end of the period ending seven years after the end of the calendar
month in which the shareholder's purchase order was accepted, Class B shares
will automatically convert to Class A shares and will no longer be subject to
the higher distribution and service fees imposed on Class B shares. Such
conversion will be on the basis of the relative net asset values of the two
classes, without the imposition of any sales load, fee or other charge. The
purpose of the conversion feature is to reduce the distribution services fee
paid by holders of Class B shares that
24

<PAGE>
have been outstanding long enough for the Distributor to have been compensated
for the expenses associated with the sale of such shares.
Class C Shares -- Level-Load Alternative. Class C shares are only offered
through broker-dealers who have special distribution agreements with EDI. You
may purchase Class C shares at net asset value without any initial sales charge
and, therefore, the full amount of your investment will be used to purchase Fund
shares. However, you will pay a 1.00% CDSC if you redeem shares during the month
of purchase and the 12-month period following the month of purchase. No CDSC is
imposed on amounts redeemed thereafter. Class C shares incur higher distribution
and/or shareholder service fees than Class A shares but, unlike Class B shares,
do not convert to any other class of shares of a Fund. The higher fees mean a
higher expense ratio, so Class C shares pay correspondingly lower dividends and
may have a lower net asset value than Class A shares. A Fund will not normally
accept any purchase of Class C shares in the amount of $500,000 or more. No CDSC
will be imposed on Class C shares purchased by institutional investors and
through employee benefit and savings plans eligible for the exemption from
front-end sales charges described under "Class A Shares -- Front-End Sales
Charge Alternative" above. Broker-dealers and other financial intermediaries
whose clients have purchased Class C shares may receive a trailing commission
equal to 0.75% of the average daily net asset value of such shares on an annual
basis held by their clients more than one year from the date of purchase.
Trailing commissions will commence immediately with respect to shares eligible
for exemption from the CDSC normally applicable to Class C shares.
Contingent Deferred Sales Charge. Certain shares with respect to which a Fund
did not pay a commission on issuance, including shares obtained from dividend or
distribution reinvestment, are not subject to a CDSC. Any CDSC imposed upon the
redemption of Class A, Class B or Class C shares is a percentage of the lesser
of (1) the net asset value of the shares redeemed or (2) the net asset value at
the time of purchase of such shares.
No CDSC is imposed on a redemption of shares of a Fund in the event of:
(1) death or disability of the shareholder; (2) a lump-sum distribution from a
401(k) plan or other benefit plan qualified under the Employee Retirement Income
Security Act of 1974 ("ERISA"); (3) automatic withdrawals from ERISA plans if
the shareholder is at least 59 1/2 years old; (4) involuntary redemptions of
accounts having an aggregate net asset value of less than $1,000; (5) automatic
withdrawals under the Systematic Withdrawal Plan of up to 1.00% per month of the
shareholder's initial account balance; (6) withdrawals consisting of loan
proceeds to a retirement plan participant; (7) financial hardship withdrawals
made by a retirement plan participant; or (8) withdrawals consisting of returns
of excess contributions or excess deferral amounts made to a retirement plan
participant.
Each Fund may also sell Class A, Class B or Class C shares at net asset
value without any initial sales charge or CDSC to certain Directors, Trustees,
officers and employees of the Fund, Keystone, FUNB, Evergreen Asset, EDI and
certain of their affiliates, and to members of the immediate families of such
persons, to registered representatives of firms with dealer agreements with EDI,
and to a bank or trust company acting as a trustee for a single account.
How the Funds Value Their Shares. The net asset value of each class of shares of
a Fund is calculated by dividing the value of the amount of the Fund's net
assets attributable to that class by the number of outstanding shares of that
class. Shares are valued each day the New York Stock Exchange (the "Exchange")
is open as of the close of regular trading (currently 4:00 p.m. eastern time).
The securities in a Fund are valued at their current market values determined on
the basis of market quotations or, if such quotations are not readily available,
such other methods as the Trustees believe would accurately reflect fair value.
General. The decision as to which class of shares is more beneficial to you
depends on the amount of your investment and the length of time you will hold
it. If you are making a large investment, thus qualifying for a reduced sales
charge, you might consider Class A shares. If you are making a smaller
investment, you might consider Class B shares since 100% of your purchase is
invested immediately and since such shares will convert to Class A shares, which
incur lower ongoing distribution and/or shareholder service fees, after seven
years. If you are unsure of the time period of your investment, you might
consider Class C shares since there are no initial sales charges and, although
there is no conversion feature, the CDSC only applies to redemptions made during
the first year after the month of purchase. Consult your financial intermediary
for further information. The compensation received by broker-dealers and agents
may differ depending on whether they sell Class A, Class B or Class C shares.
There is no size limit on purchases of Class A shares.
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<PAGE>
In addition to the discount or commission paid to broker-dealers, EDI may
from time to time pay to broker-dealers additional cash or other incentives that
are conditioned upon the sale of a specified minimum dollar amount of shares of
a Fund and/or other Evergreen funds. Such incentives will take the form of
payment for attendance at seminars, lunches, dinners, sporting events or theater
performances, or payment for travel, lodging and entertainment incurred in
connection with travel by persons associated with a broker-dealer and their
immediate family members to urban or resort locations within or outside the
United States. Such a dealer may elect to receive cash incentives of equivalent
amount in lieu of such payments. EDI may also limit the availability of such
incentives to certain specified dealers. EDI from time to time sponsors
promotions involving First Union Brokerage Services, Inc., an affiliate of each
Fund's investment adviser, and select broker-dealers, pursuant to which
incentives are paid, including gift certificates and payments in amounts up to
1% of the dollar amount of shares of a Fund sold. Awards may also be made based
on the opening of a minimum number of accounts. Such promotions are not being
made available to all broker-dealers. Certain broker-dealers may also receive
payments from EDI or a Fund's investment adviser over and above the usual trail
commissions or shareholder servicing payments applicable to a given class of
shares.
Additional Purchase Information. As a condition of this offering, if a purchase
is canceled due to nonpayment or because an investor's check does not clear, the
investor will be responsible for any loss a Fund or the Fund's investment
adviser incurs. If such investor is an existing shareholder, the Fund may redeem
shares from an investor's account to reimburse the Fund or its investment
adviser for any loss. In addition, such investor may be prohibited or restricted
from making further purchases in any of the Evergreen funds. The Fund will not
accept third party checks other than those payable directly to a shareholder
whose account has been in existence at least 30 days.
HOW TO REDEEM SHARES
You may "redeem" (i.e., sell) your shares in a Fund to the Fund for cash
at their net redemption value on any day the Exchange is open, either directly
by writing to the Fund, c/o ESC, or through your financial intermediary. The
amount you will receive is the net asset value adjusted for fractions of a cent
(less any applicable CDSC) next calculated after the Fund receives your request
in proper form. Proceeds generally will be sent to you within seven days.
However, for shares recently purchased by check, the Fund will not send proceeds
until it is reasonably satisfied that the check has been collected (which may
take up to 15 days). Once a redemption request has been telephoned or mailed, it
is irrevocable and may not be modified or canceled.
Redeeming Shares Through Your Financial Intermediary. A Fund must receive
instructions from your financial intermediary before 4:00 p.m. (eastern time)
for you to receive that day's net asset value (less any applicable CDSC). Your
financial intermediary is responsible for furnishing all necessary documentation
to the Fund and may charge you for this service. Certain financial
intermediaries may require that you give instructions earlier than 4:00 p.m.
(eastern time).
Redeeming Shares Directly by Mail or Telephone. Send a signed letter of
instruction or stock power form to a Fund, c/o ESC: the registrar, transfer
agent and dividend-disbursing agent for each Fund. Stock power forms are
available from your financial intermediary, ESC, and many commercial banks.
Additional documentation is required for the sale of shares by corporations,
financial intermediaries, fiduciaries and surviving joint owners. Signature
guarantees are required for all redemption requests for shares with a value of
more than $50,000. Currently, the requirement for a signature guarantee has been
waived on redemptions of $50,000 or less when the account address of record has
been the same for a minimum period of 30 days. The Funds and ESC reserve the
right to withdraw this waiver at any time. A signature guarantee must be
provided by a bank or trust company (not a Notary Public), a member firm of a
domestic stock exchange or by other financial institutions whose guarantees are
acceptable under the Securities Exchange Act of 1934 and ESC's policies.
Shareholders may redeem amounts of $1,000 or more (up to $50,000) from
their accounts by calling the telephone number on the front page of this
prospectus between the hours of 8:00 a.m. and 6:00 p.m. (eastern time) each
business day (i.e., any weekday exclusive of days on which the Exchange or ESC's
offices are closed). The Exchange is closed on New Years Day, Martin Luther
King, Jr. Day, Presidents' Day, Good Friday, Memorial Day, Independence Day,
Labor Day, Thanksgiving Day and Christmas Day. Redemption requests received
after 4:00 p.m. (eastern time) will be processed using the net asset value
determined on the next business day. Such
26

<PAGE>
redemption requests must include the shareholder's account name, as registered
with a Fund, and the account number. During periods of drastic economic or
market changes, shareholders may experience difficulty in effecting telephone
redemptions. If you cannot reach the Fund by telephone, you should follow the
procedures for redeeming by mail or through a broker-dealer as set forth herein.
The telephone redemption service is not made available to shareholders
automatically. Shareholders wishing to use the telephone redemption service must
complete the appropriate section on the application and choose how the
redemption proceeds are to be paid. Redemption proceeds will either (1) be
mailed by check to the shareholder at the address in which the account is
registered or (2) be wired to an account with the same registration as the
shareholder's account in the Fund at a designated commercial bank.
In order to insure that instructions received by ESC are genuine when you
initiate a telephone transaction, you will be asked to verify certain criteria
specific to your account. At the conclusion of the transaction, you will be
given a transaction number confirming your request, and written confirmation of
your transaction will be mailed the next business day. Your telephone
instructions will be recorded. Redemptions by telephone are allowed only if the
address and bank account of record have been the same for a minimum period of 30
days. A Fund reserves the right at any time to terminate, suspend, or change the
terms of any redemption method described in this prospectus, except redemption
by mail, and to impose fees.
Except as otherwise noted, the Funds, ESC, and EDI will not assume
responsibility for the authenticity of any instructions received by any of them
from a shareholder in writing, over the Evergreen Express Line, or by telephone.
ESC will employ reasonable procedures to confirm that instructions received over
the Evergreen Express Line or by telephone are genuine. The Funds, ESC, and EDI
will not be liable when following instructions received over the Evergreen
Express Line or by telephone that ESC reasonably believes are genuine.
Evergreen Express Line. The Evergreen Express Line offers you specific fund
account information and price and yield quotations as well as the ability to do
account transactions, including investments, exchanges and redemptions. You may
access the Evergreen Express Line by dialing toll free 1-800-346-3858 on any
touch-tone telephone, 24 hours a day, seven days a week.
General. The sale of shares is a taxable transaction for federal income tax
purposes. The Funds may temporarily suspend the right to redeem their shares
when: (1) the Exchange is closed, other than customary weekend and holiday
closings; (2) trading on the Exchange is restricted; (3) an emergency exists and
the Fund cannot dispose of its investments or fairly determine their value; or
(4) the Securities and Exchange Commission ("SEC") so orders. The Funds reserve
the right to close an account that through redemption has fallen below $1,000
and has remained so for 30 days. Shareholders will receive 60 days' written
notice to increase the account value to at least $1,000 before the account is
closed. The Funds have elected to be governed by Rule 18f-1 under the 1940 Act
pursuant to which each Fund is obligated to redeem shares solely in cash, up to
the lesser of $250,000 or 1% of a Fund's total net assets, during any 90 day
period for any one shareholder.
EXCHANGE PRIVILEGE
How to Exchange Shares. You may exchange some or all of your shares for shares
of the same class in the other Evergreen funds through your financial
intermediary, by calling or writing to ESC or by using the Evergreen Express
Line as described above. If the shares being tendered for exchange are still
subject to a CDSC or are eligible for conversion in a specified time, such
remaining charge or remaining time will carry over to the shares being acquired
in the exchange transaction. Once an exchange request has been telephoned or
mailed, it is irrevocable and may not be modified or canceled. Exchanges will be
made on the basis of the relative net asset values of the shares exchanged next
determined after an exchange request is received. An exchange which represents
an initial investment in another Evergreen fund is subject to the minimum
investment and suitability requirements of each fund.
Each of the Evergreen funds has different investment objectives and
policies. For complete information, a prospectus of the fund into which an
exchange will be made should be read prior to the exchange. An exchange order
must comply with the requirement for a redemption or repurchase order and must
specify the dollar value or number of shares to be exchanged. An exchange is
treated for federal income tax purposes as a redemption and purchase of shares
and may result in the realization of a capital gain or loss. Shareholders are
limited to five exchanges per calendar year, with a maximum of three per
calendar quarter. This exchange privilege may be
27

<PAGE>
modified or discontinued at any time by a Fund upon 60 days' notice to
shareholders and is only available in states in which shares of the fund being
acquired may lawfully be sold.
No CDSC will be imposed in the event shares are exchanged for shares of
the same class of other Evergreen funds. If you redeem shares, the CDSC
applicable to the shares of the Evergreen fund originally purchased for cash is
applied. Also, Class B shares will continue to age following an exchange for the
purpose of conversion to Class A shares and for the purpose of determining the
amount of the applicable CDSC.
Exchanges Through Your Financial Intermediary. A Fund must receive exchange
instructions from your financial intermediary before 4:00 p.m. (eastern time)
for you to receive that day's net asset value. Your financial intermediary is
responsible for furnishing all necessary documentation to the Fund and may
charge you for this service.
Exchanges By Telephone and Mail. Exchange requests received by a Fund after 4:00
p.m. (eastern time) will be processed using the net asset value determined at
the close of the next business day. During periods of drastic economic or market
changes, shareholders may experience difficulty in effecting telephone
exchanges. You should follow the procedures outlined below for exchanges by mail
if you are unable to reach ESC by telephone. If you wish to use the telephone
exchange service you should indicate this on the application. As noted above,
the Fund will employ reasonable procedures to confirm that instructions for the
redemption or exchange of shares communicated by telephone are genuine. A
telephone exchange may be refused by the Fund or ESC if it is believed advisable
to do so. Procedures for exchanging Fund shares by telephone may be modified or
terminated at any time. Written requests for exchanges should follow the same
procedures outlined for written redemption requests in the section entitled "How
to Redeem Shares;" however, no signature guarantee is required.
SHAREHOLDER SERVICES
The Funds offers the following shareholder services. For more information
about these services or your account, contact your financial intermediary, ESC
or call the toll-free number on the front page of this prospectus. Some services
are described in more detail in the application.
Systematic Investment Plan. Under a Systematic Investment Plan, you may invest
as little as $25 per month to purchase shares of a Fund with no minimum initial
investment required.
Telephone Investment Plan. You may make investments into an existing account
electronically in amounts of not less than $100 or more than $10,000 per
investment. Telephone investment requests received by 4:00 p.m. (eastern time)
will be credited to a shareholder's account the day the request is received.
Systematic Withdrawal Plan. When an account of $10,000 or more is opened or when
an existing account reaches that size, you may participate in the Systematic
Withdrawal Plan by filling out the appropriate part of the application. Under
this Plan, you may receive (or designate a third party to receive) a monthly or
quarterly fixed-withdrawal payment in a stated amount of at least $75 and as
much as 1.0% per month or 3.0% per quarter of the total net asset value of the
Fund shares in your account when the Plan was opened. Fund shares will be
redeemed as necessary to meet withdrawal payments. All participants must elect
to have their dividends and capital gains distributions reinvested
automatically.
Investments Through Employee Benefit and Savings Plans. Certain qualified and
non-qualified employee benefit and savings plans may make shares of the Funds
and the other Evergreen funds available to their participants. Investments made
by such employee benefit plans may be exempt from front-end sales charges if
they meet the criteria set forth under "Class A Shares -- Front-End Sales Charge
Alternative." Evergreen Asset, Keystone or FUNB may provide compensation to
organizations providing administrative and recordkeeping services to plans which
make shares of the Evergreen funds available to their participants.
Automatic Reinvestment Plan. For the convenience of investors, all dividends and
distributions are automatically reinvested in full and fractional shares of a
Fund at the net asset value per share at the close of business on the record
date, unless otherwise requested by a shareholder in writing. If the transfer
agent does not receive a written request for subsequent dividends and/or
distributions to be paid in cash at least three full business days prior to a
given record date, the dividends and/or distributions to be paid to a
shareholder will be reinvested.
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<PAGE>
Dollar Cost Averaging. Through dollar cost averaging you can invest a fixed
dollar amount each month or each quarter in any Evergreen fund. This results in
more shares being purchased when the selected fund's net asset value is
relatively low and fewer shares being purchased when the fund's net asset value
is relatively high and may result in a lower average cost per share than a less
systematic investment approach.
Prior to participating in dollar cost averaging, you must establish an
account in a fund. You should designate on the application (1) the dollar amount
of each monthly or quarterly investment you wish to make, and (2) the fund in
which the investment is to be made. Thereafter, on the first day of the
designated month, an amount equal to the specified monthly or quarterly
investment will automatically be redeemed from your initial account and invested
in shares of the designated fund.
Two Dimensional Investing. You may elect to have income and capital gains
distributions from any Evergreen fund shares you own automatically invested to
purchase the same class of shares of any other Evergreen fund. You may select
this service on your application and indicate the Evergreen fund(s) into which
distributions are to be invested.
Tax Sheltered Retirement Plans. The Funds have various retirement plans
available to eligible investors, including Individual Retirement Accounts
(IRAs); Rollover IRAs; Simplified Employee Pension Plans (SEPs); Salary
Incentive Match Plan for Employees (SIMPLEs); Tax Sheltered Annuity Plans;
403(b)(7) Plans; 401(k) Plans; Keogh Plans; Profit-Sharing Plans; Medical
Savings Accounts; Pension and Target Benefit and Money Purchase Plans. For
details, including fees and application forms, call toll free 1-800-247-4075 or
write to ESC.
BANKING LAWS
The Glass-Steagall Act and other banking laws and regulations presently
prohibit member banks of the Federal Reserve System ("Member Banks") or their
non-bank affiliates from sponsoring, organizing, controlling, or distributing
the shares of registered open-end investment companies such as the Funds. Such
laws and regulations also prohibit banks from issuing, underwriting or
distributing securities in general. However, under the Glass-Steagall Act and
such other laws and regulations, a Member Bank or an affiliate thereof may act
as investment adviser, transfer agent or custodian to a registered open-end
investment company and may also act as agent in connection with the purchase of
shares of such an investment company upon the order of its customer. FUNB and
its affiliates are subject to and in compliance with the aforementioned laws and
regulations.
Changes to applicable laws and regulations or future judicial or
administrative decisions could result in FUNB or its affiliates being prevented
from continuing to perform the services required under the investment advisory
contract or from acting as agent in connection with the purchase of shares of
the Funds by its customers. If FUNB or its affiliates were prevented from
continuing to provide the services called for under the investment advisory
agreement, it is expected that the Trustees would identify, and call upon the
Funds' shareholders to approve, a new investment adviser. If this were to occur,
it is not anticipated that the shareholders of the Funds would suffer any
adverse financial consequences.
OTHER INFORMATION
DIVIDENDS, DISTRIBUTIONS AND TAXES
Each Fund intends to distribute its investment company taxable income
annually and net capital realized gains at least annually. Shareholders receive
Fund distributions in the form of additional shares of that class of shares upon
which the distribution is based or, at the shareholder's option, in cash.
Shareholders of a Fund who have not opted to receive cash prior to the payable
date for any dividend from net investment income or the record date for any
capital gains distribution will have the number of such shares determined on the
basis of the Fund's net asset value per share computed at the end of that day
after adjustment for the distribution. Net asset value is used in computing the
number of shares in both capital gains and income distribution investments.
Because Class A shares bear most of the costs of distribution of such
shares through payment of a front-end sales charge, while Class B and, when
applicable, Class C shares bear such expenses through a higher annual
distribution fee, expenses attributable to Class B shares and Class C shares
will generally be higher than
29

<PAGE>
those of Class A shares, and income distributions paid by a Fund with respect to
Class A shares will generally be greater than those paid with respect to Class B
and Class C shares.
Account statements and/or checks, as appropriate, will be mailed within
seven days after a Fund pays a distribution. Unless the Fund receives
instructions to the contrary before the record or payable date, as the case may
be, it will assume that a shareholder wishes to receive that distribution and
future capital gains and income distributions in shares. Instructions continue
in effect until changed in writing.
Each Fund intends to qualify as a regulated investment company under the
Internal Revenue Code of 1986, as amended (the "Code"). While so qualified, it
is expected that a Fund will not be required to pay any federal income taxes on
that portion of its investment company taxable income and any net realized
capital gains it distributes to shareholders. The Code imposes a 4%
nondeductible excise tax on regulated investment companies, such as the Funds,
to the extent they do not meet certain distribution requirements by the end of
each calendar year. The Funds anticipate meeting such distribution requirements.
Any taxable dividend declared in October, November or December to
shareholders of record in such a month and paid by the following January 31 will
be includable in the taxable income of shareholders as if paid on December 31 of
the year in which the dividend was declared.
A Fund may be subject to foreign withholding taxes which would reduce the
yield on its investments. Tax treaties between certain countries and the U.S.
may reduce or eliminate such taxes. Shareholders of a Fund who are subject to
U.S. federal income tax may be entitled, subject to certain rules and
limitations, to claim a federal income tax credit or deduction for foreign
income taxes paid by the Fund. See the SAI for additional details. A Fund's
transactions in options, futures and forward contracts may be subject to special
tax rules. These rules can affect the amount, timing and characteristics of
distributions to shareholders.
Each Fund is required by federal law to withhold 31% of reportable
payments (which may include dividends, capital gains distributions (if any) and
redemptions) paid to certain shareholders. In order to avoid this backup
withholding requirement, each investor must certify on the application, or on a
separate form supplied by the Funds' transfer agent, that the investor's social
security or taxpayer identification number is correct and that the investor is
not currently subject to backup withholding or is exempt from backup
withholding.
A shareholder who acquires Class A shares of a Fund and sells or
otherwise disposes of such shares within 90 days of acquisition may not be
allowed to include certain sales charges incurred in acquiring such shares for
purposes of calculating gain and loss realized upon a sale or exchange of shares
of the Fund.
Each Fund intends to distribute its net capital gains as capital gains
dividends. Shareholders should treat such dividends as long-term capital gains.
A Fund will designate capital gains distributions as such by a written notice
mailed to each shareholder no later than 60 days after the close of the Fund's
taxable year. If a shareholder receives a capital gain dividend and holds his
shares for six months or less, then any allowable loss on disposition of such
shares will be treated as a long-term capital loss to the extent of such capital
gain dividend.
The foregoing discussion of federal income tax consequences is based on
tax laws and regulations in effect on the date of this prospectus and is subject
to change by legislative or administrative action. As the foregoing discussion
is for general information only, you should also review the discussion of
"Additional Tax Information" contained in the SAI. In addition, you should
consult your own tax adviser as to the tax consequences of investments in a
Fund, including the application of state and local taxes which may be different
from the federal income tax consequences described above.
GENERAL INFORMATION
Portfolio Turnover and Brokerage. The estimated annual portfolio turnover rate
for the EVERGREEN FUND is not expected to exceed 100%. The estimated annual
portfolio turnover rate for EVERGREEN MICRO CAP FUND, EVERGREEN AGGRESSIVE
GROWTH FUND, EVERGREEN OMEGA FUND, EVERGREEN SMALL COMPANY GROWTH FUND and
EVERGREEN STRATEGIC GROWTH FUND is not expected to exceed 200%. A portfolio
turnover rate of 100% would occur if all of a Fund's portfolio securities were
replaced in one year. The portfolio turnover rate experienced by a Fund directly
affects the transaction costs relating to the purchase and sale of securities
which the Fund bears directly. A high rate of portfolio turnover will increase
such costs. It is contemplated that Lieber & Company, an
30

<PAGE>
affiliate of Evergreen Asset and a member of the New York and American Stock
Exchanges, will to the extent practicable effect substantially all of the
portfolio transactions for EVERGREEN FUND and EVERGREEN MICRO CAP FUND effected
on those exchanges. See the SAI for further information regarding the practices
of the Funds affecting portfolio turnover and brokerage allocation practices.
Portfolio Transactions. Consistent with the Conduct Rules of the National
Association of Securities Dealers, Inc., and subject to seeking best price and
execution, a Fund may consider sales of its shares as a factor in the selection
of broker-dealers to enter into portfolio transactions with the Fund.

Other Classes of Shares. Each Fund currently offers four classes of shares,
Class A, Class B, Class C and Class Y (except for EVERGREEN STRATEGIC GROWTH
FUND which offers three classes of shares, Class A, Class B and Class C), and
may in the future offer additional classes. Class Y shares are not offered by
this prospectus and are only available to (1) persons who at or prior to
December 31, 1994 owned shares in a mutual fund advised by Evergreen Asset, (2)
certain institutional investors and (3) investment advisory clients of FUNB,
Evergreen Asset, Keystone or their affiliates. The dividends payable with
respect to Class A, Class B and Class C shares will be less than those payable
with respect to Class Y shares due to the distribution and shareholder
servicing-related expenses borne by Class A, Class B and Class C shares and the
fact that such expenses are not borne by Class Y shares. Investors should
telephone (800) 343-2898 to obtain more information on other classes of shares.

Performance Information. From time to time, a Fund may quote its "total return"
or "yield" for a specified period in advertisements, reports or other
communications to shareholders. Total return and yield are computed separately
for Class A, Class B, Class C and Class Y shares. A Fund's total return for each
such period is computed by finding, through the use of a formula prescribed by
the SEC, the average annual compounded rate of return over the period that would
equate an assumed initial amount invested to the value of the investment at the
end of the period. For purposes of computing total return, dividends and capital
gains distributions paid on shares of a Fund are assumed to have been reinvested
when paid and the maximum sales charges applicable to purchases of the Fund's
shares are assumed to have been paid.
Yield is a way of showing the rate of income a Fund earns on its
investments as a percentage of the Fund's share price. A Fund's yield is
calculated according to accounting methods that are standardized by the SEC for
all stock and bond funds. Because yield accounting methods differ from the
method used for other accounting purposes, the Fund's yield may not equal its
distribution rate, the income paid to your account or the net investment income
reported in the Fund's financial statements. To calculate yield, a Fund takes
the interest and dividend income it earned from its portfolio of investments (as
defined by the SEC formula) for a 30-day period (net of expenses), divides it by
the average number of shares entitled to receive dividends, and expresses the
result as an annualized percentage rate based on the Fund's share price at the
end of the 30-day period. This yield does not reflect gains or losses from
selling securities.
Performance data may be included in any advertisement or sales literature
of a Fund. These advertisements may quote performance rankings or ratings of the
Fund by financial publications or independent organizations such as Lipper
Analytical Services, Inc. and Morningstar, Inc. or compare the Fund's
performance to various indices. A Fund may also advertise in items of sales
literature an "actual distribution rate" which is computed by dividing the total
ordinary income distributed (which may include the excess of short-term capital
gains over losses) to shareholders for the latest 12-month period by the maximum
public offering price per share on the last day of the period. Investors should
be aware that past performance may not be indicative of future results.
In marketing a Fund's shares, information may be provided that is
designed to help individuals understand their investment goals and explore
various financial strategies. Such information may include publications
describing general principles of investing, such as asset allocation,
diversification, risk tolerance, and goal setting; a questionnaire designed to
help create a personal financial profile; and an action plan offering investment
alternatives. The information provided to investors may also include discussions
of other Evergreen funds, products, and services, which may include: retirement
investing; brokerage products and services; the effects of periodic investment
plans and dollar cost averaging; saving for college; and charitable giving. In
addition, the information provided to investors may quote financial or business
publications and periodicals, including model portfolios or allocations, as they
relate to fund management, investment philosophy, and investment techniques.
31

<PAGE>
The materials may also reprint, and use as advertising and sales literature,
articles from Evergreen Events, a quarterly magazine provided free of charge to
Evergreen fund shareholders.
Additional Information. This prospectus and the SAI, which has been incorporated
by reference herein, do not contain all the information set forth in the
Registration Statement filed by the Trust with the SEC under the Securities Act
of 1933, as amended. Copies of the Registration Statement may be obtained at a
reasonable charge from the SEC or may be examined, without charge, at the
offices of the SEC in Washington, D.C.
32

<PAGE>
INVESTMENT ADVISER
Evergreen Asset Management Corp., 2500 Westchester Avenue, Purchase, New York
10577
EVERGREEN FUND, EVERGREEN MICRO CAP FUND

Capital Management Group of First Union National Bank, 201 South College
Street, Charlotte, North Carolina 28288
EVERGREEN AGGRESSIVE GROWTH FUND

Keystone Investment Management Company, 200 Berkeley Street, Boston,
Massachusetts 02116-5034
EVERGREEN OMEGA FUND
EVERGREEN SMALL COMPANY GROWTH FUND
EVERGREEN STRATEGIC GROWTH FUND

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

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

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

INDEPENDENT AUDITORS
Price Waterhouse LLP, 1177 Avenue of the Americas, New York, New York 10036
EVERGREEN FUND, EVERGREEN MICRO CAP FUND, EVERGREEN AGGRESSIVE GROWTH FUND

KPMG Peat Marwick LLP, 99 High Street, Boston, Massachusetts 02110
EVERGREEN OMEGA FUND, EVERGREEN SMALL COMPANY GROWTH FUND, EVERGREEN
STRATEGIC GROWTH FUND

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

542080

<PAGE>

- -------------------------------------------------------------------------------
PROSPECTUS February 1, 1998
- -------------------------------------------------------------------------------

[EVERGREEN LOGO APPEARS HERE]

EVERGREEN DOMESTIC GROWTH FUNDS

- -------------------------------------------------------------------------------
Evergreen Fund
Evergreen Micro Cap Fund
Evergreen Aggressive Growth Fund
Evergreen Omega Fund
Evergreen Small Company Growth Fund

CLASS Y SHARES

The Evergreen Domestic Growth Funds (the "Funds") are designed to provide
investors with a selection of investment alternatives which seek to provide
capital growth and diversification. This prospectus provides information
regarding the Class Y shares offered by the Funds. Each Fund is a diversified
series of an open-end, management investment company. This prospectus sets
forth concise information about the Funds that a prospective investor should
know before investing. The address of the Funds is 200 Berkeley Street, Boston,
Massachusetts 02116.

A Statement of Additional Information for the Funds dated February 1,
1998, as supplemented from time to time, has been filed with the Securities and
Exchange Commission and is incorporated by reference herein. The Statement of
Additional Information provides information regarding certain matters discussed
in this prospectus and other matters which may be of interest to investors, and
may be obtained without charge by calling the Funds at (800) 343-2898. There
can be no assurance that the investment objective of any Fund will be achieved.
Investors are advised to read this prospectus carefully.

An investment in the Funds is not a deposit or obligation of any bank, is not
endorsed or guaranteed by any bank, and is not insured or otherwise protected
by the U.S. government, the Federal Deposit Insurance Corporation, the Federal
Reserve Board, or any other government agency and involves risk, including the
possible loss of principal.

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

Keep This Prospectus For Future Reference

<PAGE>

TABLE OF CONTENTS
-----------------

<TABLE>
<S> <C>
EXPENSE INFORMATION 3
FINANCIAL HIGHLIGHTS 5
DESCRIPTION OF THE FUNDS 8
Investment Objectives and Policies 8
Investment Practices and Restrictions 10
ORGANIZATION AND SERVICE PROVIDERS 14
Organization 14
Service Providers 15

</TABLE>
<TABLE>
<S> <C>
PURCHASE AND REDEMPTION OF SHARES 16
How to Buy Shares 16
How to Redeem Shares 17
Exchange Privilege 18
Shareholder Services 19
Banking Laws 19
OTHER INFORMATION 20
Dividends, Distributions and Taxes 20
General Information 21
</TABLE>

2
<PAGE>

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

<TABLE>
<CAPTION>
SHAREHOLDER TRANSACTION EXPENSES
<S> <C>
Sales Charge Imposed on Purchases None
Sales Charge on Dividend Reinvestments None
Contingent Deferred Sales Charge None
</TABLE>

Annual operating expenses reflect the normal operating expenses of a Fund,
and include costs such as management and other fees. The table below shows for
each of Evergreen Fund, Evergreen Micro Cap Fund, Evergreen Aggressive Growth
Fund and Evergreen Omega Fund actual annual operating expenses for the fiscal
period ended September 30, 1997 and for Evergreen Small Company Growth Fund
annual operating expenses have been estimated for the fiscal period ending
September 30, 1998. The examples show what you would pay if you invested $1,000
over the periods indicated. The examples assume that you reinvest all of your
dividends and that a Fund's average annual return will be 5%. The examples are
for illustration purposes only and should not be considered a representation of
past or future expenses or annual return. A Fund's actual expenses and returns
will vary. For a more complete description of the various costs and expenses
borne by a Fund see "Organization and Service Providers."

Evergreen Fund

<TABLE>
<CAPTION>
Annual Operating
Expenses
-----------------
<S> <C>
Management Fees 0.92%
Other Expenses 0.23%
----
Total 1.15%
====
</TABLE>

<TABLE>
<CAPTION>
Example
--------
<S> <C>
After 1 Year $ 12
After 3 Years $ 37
After 5 Years $ 63
After 10 Years $140
</TABLE>

Evergreen Micro Cap Fund

<TABLE>
<CAPTION>
Annual Operating
Expenses
-----------------
<S> <C>
Management Fees 1.00%
Other Expenses 0.59%
----
Total 1.59%
====
</TABLE>

<TABLE>
<CAPTION>
Example
--------
<S> <C>
After 1 Year $ 16
After 3 Years $ 50
After 5 Years $ 87
After 10 Years $189
</TABLE>

Evergreen Aggressive Growth Fund

<TABLE>
<CAPTION>
Annual Operating
Expenses
-----------------
<S> <C>
Management Fees 0.64%
Other Expenses 0.37%
----
Total 1.01%
====
</TABLE>

<TABLE>
<CAPTION>
Example
--------
<S> <C>
After 1 Year $ 10
After 3 Years $ 32
After 5 Years $ 56
After 10 Years $124
</TABLE>

Evergreen Omega Fund

<TABLE>
<CAPTION>
Annual Operating
Expenses
-----------------
<S> <C>
Management Fees 0.74%
Other Expenses 0.50%
----
Total 1.24%
====
</TABLE>

<TABLE>
<CAPTION>
Example
--------
<S> <C>
After 1 Year $ 13
After 3 Years $ 39
After 5 Years $ 68
After 10 Years $150
</TABLE>

3
<PAGE>

Evergreen Small Company Growth Fund

<TABLE>
<CAPTION>
Annual Operating
Expenses
-----------------
<S> <C>
Management Fees 0.48%
Other Expenses 0.29%
----
Total 0.77%
====
</TABLE>

<TABLE>
<CAPTION>
Example
--------
<S> <C>
After 1 Year $ 8
After 3 Years $25
</TABLE>

4
<PAGE>

- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
The tables on the following pages present, for each Fund, (except
Evergreen Small Company Growth Fund) financial highlights for a share
outstanding throughout each period indicated. The information in the tables for
the ten most recent fiscal years or the life of the Fund, if shorter, for
Evergreen Fund has been audited by Price Waterhouse LLP, the Fund's independent
auditors. The information in the tables for Evergreen Micro Cap Fund for the
fiscal years ended September 30, 1997 and 1996 has been audited by Price
Waterhouse LLP, the Fund's current independent auditors. The information in the
tables for each of the Fund's fiscal year ended September 30, 1995, for the
four months ended September 30, 1994 and each of the years in the seven year
period ended May 31, 1994 was audited by the Fund's prior independent auditors.
The information in the tables for Evergreen Aggressive Growth Fund for the
fiscal periods ended September 30, 1997 through 1995 has been audited by Price
Waterhouse LLP, the Fund's current independent auditors. The information in the
tables for Evergreen Omega Fund for the period from January 13, 1997 (date of
initial public offering) to September 30, 1997 has been audited by KPMG Peat
Marwick LLP, the Fund's current independent auditors. Class Y shares of
Evergreen Small Company Growth Fund were not offered until January 23, 1998.
Therefore, no financial highlights are currently available. A report of Price
Waterhouse LLP or KPMG Peat Marwick LLP, as the case may be, on the audited
information with respect to each Fund is incorporated by reference in the
Statement of Additional Information. The following information for each Fund
should be read in conjunction with the financial statements and related notes
which are incorporated by reference in the Statement of Additional Information.

Further information about each Fund's performance is contained in the
Fund's Annual Report to shareholders, which may be obtained without charge.

Evergreen Fund -- Class Y Shares

<TABLE>
<CAPTION>
Year Ended September 30,
-----------------------------------------------------------
1997(double dagger) 1996 1995 1994
--------------------- ------------- ----------- -----------
<S> <C> <C> <C> <C>
PER SHARE DATA:
Net asset value beginning of year ............. $ 17.71 $ 15.59 $ 14.62 $ 14.46
------- ---------- ------- -------
Income from investment operations
Net investment income ........................ 0.16 0.24 0.10 0.07
Net realized and unrealized gain (loss) on
investments ................................. 5.73 2.55 3.10 0.79
------- ---------- ------- -------
Total from investment operations ........... 5.89 2.79 3.20 0.86
------- ---------- ------- -------
Less distributions from
Net investment income ........................ ( 0.12) ( 0.09) ( 0.07) ( 0.09)
Net realized gain on investments ............. ( 0.41) ( 0.58) ( 2.16) ( 0.61)
--------- ---------- -------- --------
Total distributions ........................ ( 0.53) ( 0.67) ( 2.23) ( 0.70)
--------- ---------- -------- --------
Net asset value end of year ................... $ 23.07 $ 17.71 $ 15.59 $ 14.62
========= ========== ======== ========
TOTAL RETURN .................................. 34.08 % 18.43 % 26.79% 6.16%
RATIOS/SUPPLEMENTAL DATA:
Ratios to average net assets:
Total expenses ............................... 1.15 % 1.15 % 1.16% 1.13%
Total expenses, excluding indirectly paid
expenses .................................... 1.15 % N/A N/A N/A
Interest expense ............................. N/A N/A 0.06% 0.09%
Net investment income ........................ 0.80 % 0.93 % 0.53% 0.40%
Portfolio turnover rate ....................... 12% 15% 19% 19%
Average commission rate paid per share ........ $ 0.0577 $ 0.0603 N/A N/A
Net assets end of year (millions) ............. $ 1,104 $ 841 $ 612 $ 526

<CAPTION>
1993 1992 1991 1990 1989 1988*
----------- ----------- ---------- ------------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
PER SHARE DATA:
Net asset value beginning of year ............. $ 13.10 $ 13.32 $ 9.66 $ 14.01 $ 12.47 $ 15.12
------- ------- ------- --------- ------- --------
Income from investment operations
Net investment income ........................ 0.09 0.09 0.17 0.24 0.32 0.21
Net realized and unrealized gain (loss) on
investments ................................. 1.96 0.55 3.93 ( 3.62) 1.99 ( 1.05)
------- ------- ------- --------- ------- --------
Total from investment operations ........... 2.05 0.64 4.10 ( 3.38) 2.31 ( 0.84)
------- ------- ------- --------- ------- --------
Less distributions from
Net investment income ........................ ( 0.07) ( 0.17) ( 0.18) ( 0.36) ( 0.21) ( 0.25)
Net realized gain on investments ............. ( 0.62) ( 0.69) ( 0.26) ( 0.61) ( 0.56) ( 1.56)
-------- -------- ------- --------- -------- --------
Total distributions ........................ ( 0.69) ( 0.86) ( 0.44) ( 0.97) ( 0.77) ( 1.81)
-------- -------- ------- --------- -------- --------
Net asset value end of year ................... $ 14.46 $ 13.10 $ 13.32 $ 9.66 $ 14.01 $ 12.47
======== ======== ======= ========= ======== ========
TOTAL RETURN .................................. 15.83% 5.19% 43.74% (25.38%) 19.99% ( 1.87%)
RATIOS/SUPPLEMENTAL DATA:
Ratios to average net assets:
Total expenses ............................... 1.11% 1.13% 1.15% 1.15% 1.11% 1.03%
Total expenses, excluding indirectly paid
expenses .................................... N/A N/A N/A N/A N/A N/A
Interest expense ............................. 0.01% 0.56% 1.45% 1.83% 2.46% 1.70%
Net investment income ........................ 0.60% 32% 35% 39% 40% 42%
Portfolio turnover rate ....................... 21% N/A N/A N/A N/A N/A
Average commission rate paid per share ........ N/A
Net assets end of year (millions) ............. $ 657 $ 772 $ 755 $ 525 $ 867 $ 751
</TABLE>

- --------
(double dagger) Calculated based on average shares outstanding throughout the
period.
* Net of expense limitation in fiscal year 1988.

5
<PAGE>

Evergreen Micro Cap Fund -- Class Y Shares

<TABLE>
<CAPTION>
Year Ended
Year Ended September 30, May 31,
-------------------------------------------------------------- -----------------------
1997(double dagger) 1996 1995 1994* 1994 1993
--------------------- ------------- ----------- -------------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
PER SHARE DATA:
Net asset value beginning of
year ........................... $ 17.35 $ 18.42 $ 21.74 $ 21.20 $ 20.87 $ 21.02
------- -------- ------- --------- ------- -------
Income from investment
operations
Net investment income
(loss) ........................ ( 0.09) ( 0.08) ( 0.23) ( 0.05) ( 0.07) ( 0.03)
Net realized and
unrealized gain (loss)
on investments ................ 9.57 ( 0.43) 0.59 0.59 1.67 1.57
-------- -------- ------- --------- ------- -------
Total from investment
operations .................. 9.48 ( 0.51) 0.36 0.54 1.60 1.54
-------- -------- ------- --------- ------- -------
Less distributions from:
Net investment income .......... 0 0 0 0 0 0
Net realized gain on
investments ................... 0 ( 0.56) ( 3.68) 0 ( 1.27) ( 1.69)
-------- -------- ------- --------- ------- -------
Total distributions .......... 0 ( 0.56) ( 3.68) 0 ( 1.27) ( 1.69)
-------- -------- ------- --------- ------- -------
Net asset value end of year ..... $ 26.83 $ 17.35 $ 18.42 $ 21.74 $ 21.20 $ 20.87
======== ======== ======= ========= ======= =======
TOTAL RETURN .................... 54.64 % ( 2.73 %) 4.76% 2.55% 7.64% 7.47%
RATIOS/SUPPLEMENTAL
DATA:
Ratios to average net
assets:
Total expenses ................. 1.59 % 1.55 % 1.36% 1.37%+ 1.26% 1.24%
Interest expense ............... 0.02 % 0.02 % N/A N/A N/A N/A
Total expenses, excluding
indirectly paid
expenses ...................... 1.58 % N/A N/A N/A N/A N/A
Total expenses, excluding
fee waivers & expense
reimbursements ................ N/A 1.60 % N/A N/A N/A N/A
Net investment income
(loss) ........................ ( 0.45 %) ( 0.38 %) ( 0.87%) ( 0.70%)+ ( 0.33%) ( 0.07%)
Portfolio turnover rate ......... 59% 160% 84% 36% 89% 29%
Average commission rate
paid per share ................. $ 0.0543 $ 0.0465 N/A N/A N/A N/A
Net assets end of year
(thousands) .................... $ 50,732 $ 39,622 $64,721 $ 99,340 $96,357 $80,605

<CAPTION>
Year Ended May 31,
---------------------------------------------------------------------
1992 1991 1990 1989(double dagger) 1988
----------- ----------- ----------- --------------------- -----------
<S> <C> <C> <C> <C> <C>
PER SHARE DATA:
Net asset value beginning of
year ........................... $ 18.81 $ 17.69 $ 21.02 $ 16.82 $ 18.55
------- ------- ------- ------- -------
Income from investment
operations
Net investment income
(loss) ........................ 0.02 0.56 0.45 0.16 0
Net realized and
unrealized gain (loss)
on investments ................ 3.33 1.67 0.25 4.37 ( 0.78)
------- ------- ------- ------- -------
Total from investment
operations .................. 3.35 2.23 0.70 4.53 ( 0.78)
------- ------- ------- ------- -------
Less distributions from:
Net investment income .......... ( 0.14) ( 0.53) ( 0.36) ( 0.05) 0
Net realized gain on
investments ................... ( 1.00) ( 0.58) ( 3.67) ( 0.28) ( 0.95)
------- ------- ------- ------- -------
Total distributions .......... ( 1.14) ( 1.11) ( 4.03) ( 0.33) ( 0.95)
------- ------- ------- ------- -------
Net asset value end of year ..... $ 21.02 $ 18.81 $ 17.69 $ 21.02 $ 16.82
======= ======= ======= ======= =======
TOTAL RETURN .................... 18.33% 14.42% 4.20% 27.35% ( 4.01%)
RATIOS/SUPPLEMENTAL
DATA:
Ratios to average net
assets:
Total expenses ................. 1.25% 1.32% 1.33% 1.30% 1.47%
Interest expense ............... N/A N/A N/A N/A N/A
Total expenses, excluding
indirectly paid
expenses ...................... N/A N/A N/A N/A N/A
Total expenses, excluding
fee waivers & expense
reimbursements ................ N/A N/A N/A N/A N/A
Net investment income
(loss) ........................ 0.22% 3.32% 2.25% 0.86% 0.01%
Portfolio turnover rate ......... 55% 59% 46% 45% 47%
Average commission rate
paid per share ................. N/A N/A N/A N/A N/A
Net assets end of year
(thousands) .................... $62,172 $45,687 $37,838 $37,292 $23,007
</TABLE>

- --------
(double dagger) Calculated based on average shares outstanding throughout the
period.
* For the four months ended September 30, 1994. The Fund changed its fiscal
year end from May 31 to September 30, effective September 30, 1994.
+ Annualized.

6
<PAGE>

Evergreen Aggressive Growth Fund -- Class Y Shares

<TABLE>
<CAPTION>
Year Ended September 30,
----------------------------------------------------
1997(double dagger) 1996 1995*
--------------------- ------------- ----------------
<S> <C> <C> <C>
PER SHARE DATA:
Net asset value beginning of year ................... $ 21.09 $ 17.38 $ 15.79
------- -------- --------
Income from investment operations
Net investment loss ................................ ( 0.17) ( 0.06) ( 0.01)
Net realized and unrealized gain on investments .... 2.65 4.41 1.60
-------- -------- --------
Total from investment operations ................ 2.48 4.35 1.59
-------- -------- --------
Less distributions from
Net realized gain on investments ................... 0 ( 0.64) 0
-------- -------- --------
Total distributions ............................. 0 ( 0.64) 0
-------- -------- --------
Net asset value end of year ......................... $ 23.57 $ 21.09 $ 17.38
======== ======== ========
TOTAL RETURN ........................................ 11.76 % 25.84 % 10.07%
RATIOS/SUPPLEMENTAL DATA:
Ratios to average net assets:
Total expenses ..................................... 1.01 % 0.97 % 1.08%++
Total expenses, excluding indirectly paid expenses . 1.00 % N/A N/A
Net investment loss ................................ ( .78 %) ( 0.60 %) ( 0.71%)++
Portfolio turnover rate ............................. 56% 33% 31%
Average commission rate paid per share .............. $ 0.0531 $ 0.0582 N/A
Net assets end of year (thousands) .................. $ 44,384 $ 25,918 $ 1,889
</TABLE>

- --------
(double dagger) Calculations based on average shares outstanding throughout
the period.
* For the period from July 11, 1995 (commencement of class operations) to
September 30, 1995.
++ Annualized.

7
<PAGE>

Evergreen Omega Fund -- Class Y Shares

<TABLE>
<CAPTION>
For the period from
January 13, 1997
(Date of initial
public offering)
to September 30, 1997(double dagger)
-------------------------------------
<S> <C>
PER SHARE DATA:
Net asset value beginning of period ........................ $ 19.98
--------
Income from investment operations
Net investment loss ....................................... ( 0.01)
Net realized and unrealized gain on investments ........... 3.56
--------
Total from investment operations ........................ 3.55
--------
Less distributions from
Net realized gain on investments .......................... ( 0.85)
--------
Total distributions ..................................... ( 0.85)
--------
Net asset value end of period .............................. $ 22.68
========
TOTAL RETURN ............................................... 18.60 %
RATIOS/SUPPLEMENTAL DATA:
Ratios to average net assets ...............................
Total expenses ............................................ 1.24 %++
Total expenses, excluding indirectly paid expenses ........ 1.24% ++
Net investment income (loss) .............................. ( 0.21 %)++
Portfolio turnover rate .................................... 76%
Average commission rate paid per share ..................... $ 0.0580
Net assets end of period (thousands) ....................... $ 5
</TABLE>

- --------
(double dagger) Calculated based on average shares outstanding throughout the
period.
++ Annualized, amounts calculated for period from July 23, 1997 (commencement
of class operations) to September 30, 1997.

- --------------------------------------------------------------------------------
DESCRIPTION OF THE FUNDS
- --------------------------------------------------------------------------------
INVESTMENT OBJECTIVES AND POLICIES

Each Fund's investment objective is nonfundamental; as a result, a Fund
may change its objective without a shareholder vote. Each Fund has also adopted
certain fundamental investment policies which are mainly designed to limit a
Fund's exposure to risk. Each Fund's fundamental policies cannot be changed
without a shareholder vote. See the Statement of Additional Information ("SAI")
for more information regarding a Fund's fundamental investment policies or
other related investment policies. There can be no assurance that a Fund's
investment objective will be achieved.

Evergreen Fund

The Evergreen Fund seeks to achieve its investment objective of capital
appreciation principally through investments in common stock and securities
convertible into or exchangeable for common stock of companies which are
little-known, relatively small or represent special situations which, in the
opinion of the Fund's investment adviser, offer potential for capital
appreciation. A "little-known" company means one whose business is limited to a
regional market or whose securities are closely held with only a small
proportion traded publicly. A "relatively small" company means one which has a
small share of the market for its products or services in comparison with other
companies in its field, or which provides goods or services for a limited
market. A "special situation" company is one which offers potential for capital
appreciation because of a recent or anticipated change in structure,
management, products or services. In addition to the securities described
above, the Evergreen Fund may invest in securities of relatively well-known and
large companies with potential for capital appreciation. Investments may also
be made to a limited

8
<PAGE>

degree in non-convertible debt securities and preferred stocks which offer an
opportunity for capital appreciation. Short-term investments may also be made
if the Fund's investment adviser believes that such action will benefit the
Fund. See "Special Risk Considerations."

Evergreen Micro Cap Fund

The investment objective of Evergreen Micro Cap Fund is to achieve capital
appreciation; income is not a factor in the selection of portfolio securities.
The Fund seeks to achieve its objective principally through investments in
common stock of companies for which there is a relatively limited trading
market. A relatively limited trading market is one in which only small amounts
of stock are available at any given time generally through five or fewer market
makers. The securities of such companies are often traded only over-the-counter
or on a regional securities exchange, rarely on a national securities exchange,
and may not trade every day or in the volume typical of trading on a national
securities exchange.

Investments by the Fund are made with a view toward taking advantage of
market inefficiencies affecting the price of a company's securities or by
exploiting the investment opportunities which may be inherent in companies
offering new or unique products or services. Market inefficiency can result
from a company being too small to be covered by most industry analysts, thereby
resulting in a limited dissemination of information about the company or its
industry. The companies in which the Fund may invest are small, but have at
least $1,000,000 and generally no more than $150,000,000 of market
capitalization (see "Investment Practices and Restrictions -- Special Risk
Considerations"). The Fund may also invest in little-known or unpopular
companies which may not be widely recommended for purchase by industry analysts
due to some situation unique to the company or its industry. There are no
restrictions as to types of businesses or industries in which the Fund may
invest. The Fund's investment adviser believes that its investment research
programs will uncover a variety of relatively unexploited investment
opportunities.

The Fund's investment adviser will attempt to screen the universe of
companies falling within the capitalization range described above and invest
primarily in what it believes to be the 100 best based on certain qualitative
and quantitative criteria. Such companies may include those with the highest
return on equity and consistent earnings growth. The criteria will be reviewed
and evaluated on an ongoing basis by the Fund's investment adviser. In
addition, the Fund will invest in other companies which do not meet the
screening criteria. These will include companies which offer unique products or
services or operate in industries or sectors that have, in the opinion of the
Fund's investment adviser, significant growth prospects. In selecting
investment opportunities for the Fund, the Fund's investment adviser will use
certain proprietary computer screening techniques and the extensive library
facilities of Lieber & Company, the Fund's sub-adviser.

While the focus of Evergreen Micro Cap Fund is on long-term capital
appreciation, investments may on occasion be made with the expectation of
short-term capital appreciation. Securities held for a short time period may be
sold if the investment objective for such securities has been achieved or if
other circumstances warrant.

Evergreen Aggressive Growth Fund

The Evergreen Aggressive Growth Fund's investment objective is to achieve
long-term capital appreciation by investing primarily in common stocks of
emerging growth companies and larger, more well established companies, all of
which are viewed by the Fund's investment adviser as having above-average
appreciation potential. Under normal circumstances, the Fund intends to invest
at least 65% of its net assets in common stocks or securities convertible into
common stocks. The Fund's investment adviser considers an emerging growth
company to be one which is still in the developmental stage, yet has
demonstrated, or is expected to achieve, growth of earnings over various major
business cycles. Important qualities of any emerging growth company include
sound management and a good product with growing market opportunities. To the
extent that its assets are not invested in common stocks or securities
convertible into common stocks, the Fund also may invest its assets in, or
enter into repurchase agreements with banks or broker-dealers with respect to,
investment grade corporate bonds, United States ("U.S.") government securities,
commercial paper and certificates of deposit of domestic banks.

9
<PAGE>

Consistent with its investment objective, the Fund also may invest in
equity securities of seasoned, established companies which its investment
adviser believes have above-average appreciation potential similar to that of
companies in the developmental stage. This may be due, for example, to
management change, new technology, new product or service developments, changes
in demand, or other factors. Investments in stocks of emerging growth companies
may involve special risks. See "Special Risk Considerations."

Evergreen Omega Fund

The investment objective of Evergreen Omega Fund is to seek maximum
capital growth by investing in a varied portfolio consisting primarily of
common stocks and securities convertible into common stocks. The Fund pursues
its objective by employing techniques of the fully managed-investment concept,
meaning that the Fund's investment adviser will continuously review both
individual securities and relevant general conditions. Whenever, in the opinion
of the Fund's investment adviser, a security no longer seems to have the
required characteristics, an anticipated level of performance has been
achieved, or other securities present relatively greater opportunities for
realizing the Fund's objective, appropriate changes will be made in the Fund's
portfolio. The Fund's equity position will be changed as the investment adviser
changes its evaluation of trends in general securities price levels. Portfolio
turnover rate will not be considered a limiting factor in the execution of
investment decisions.

Evergreen Small Company Growth Fund

Evergreen Small Company Growth Fund invests at least 65% of its total
assets in equity securities of companies with small market capitalizations. For
this purpose, companies with small market capitalizations are generally those
with market capitalizations of less than $1 billion ("small cap") at the time
of the Fund's investment. Companies whose capitalization falls outside this
range after the purchase continue to be considered small cap for this purpose.

While the Fund focuses on small cap stocks, it may also invest in other
types of securities without regard to the market capitalization of the issuer
and which may be listed on national exchanges or traded over-the-counter,
including other common stocks, debt securities convertible into common stocks
or having common stock characteristics, and rights and warrants to purchase
common stocks. While income is not an objective, securities appearing to offer
attractive possibilities for future growth of income may be included in the
portfolio whenever it seems possible to do so without conflicting with the
Fund's objective of capital growth.

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

Evergreen Small Company Growth Fund may invest in limited partnerships,
including master limited partnerships. Evergreen Omega Fund and Evergreen Small
Company Growth Fund may invest up to 25% of their assets in foreign securities.

Evergreen Omega Fund may invest, for temporary defensive purposes, without
limit in investment grade bonds or debentures rated by Moody's Investors
Service ("Moody's") as Baa or better or by Standard & Poor's Ratings Group
("S&P") as BBB or better or those having at least similar quality in the
investment adviser's judgment. The Fund may also invest in non-convertible
preferred stocks of companies considered creditworthy and able to sustain
dividend payments and in short-term money market instruments maturing in one
year or less.

In addition to the investment policies detailed above, each Fund may
employ certain additional investment strategies which are discussed in
"Investment Practices and Restrictions."

INVESTMENT PRACTICES AND RESTRICTIONS

Repurchase Agreements. The Funds may invest in repurchase agreements. A
repurchase agreement is an agreement by which a Fund purchases a security
(usually U.S. government securities) for cash and obtains a simultaneous
commitment from the seller (usually a bank or broker/dealer) to repurchase the
security at an agreed-upon price and specified future date. The repurchase
price reflects an agreed-upon interest rate for the time period of the
agreement. The Fund's risk is the inability of the seller to pay the
agreed-upon price on the delivery date. However,

10
<PAGE>

this risk is tempered by the ability of the Fund to sell the security in the
open market in the case of a default. In such a case, the Fund may incur costs
in disposing of the security which would increase Fund expenses. The Fund's
investment adviser will monitor the creditworthiness of the firms with which
the Fund enters into repurchase agreements.

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

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

Securities Lending. To generate income and offset expenses, each Fund may lend
- ------------------
securities to broker-dealers and other financial institutions. Loans of
securities by a Fund may not exceed 30% of the value of the Fund's total
assets. While securities are on loan, the borrower will pay the Fund any income
accruing on the security. Also, the Fund may invest any collateral it receives
in additional securities. Gains or losses in the market value of a lent
security will affect the Fund and its shareholders. When the Fund lends its
securities, it runs the risk that it could not retrieve the securities on a
timely basis possibly losing the opportunity to sell the securities at a
desirable price. Also, if the borrower files for bankruptcy or becomes
insolvent, the Fund's ability to dispose of the securities may be delayed.

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

Borrowing. Each Fund may borrow from banks in an amount up to 33 1/3% of its
- ---------
total assets, taken at market value. Each Fund may also borrow an additional 5%
of its total assets from banks and others. A Fund may only borrow as a
temporary measure for extraordinary or emergency purposes such as the
redemption of Fund shares. A Fund will not purchase securities while borrowings
are outstanding except to exercise prior commitments and to exercise
subscription rights. The Funds do not intend to leverage.

Illiquid Securities. Each Fund may invest up to 15% of its net assets in
- -------------------
illiquid securities and other securities which are not readily marketable.
Repurchase agreements with maturities longer than seven days will be included
for the purpose of the foregoing 15% limit. The inability of a Fund to dispose
of illiquid investments readily or at a reasonable price could impair the
Fund's ability to raise cash for redemptions or other purposes.

Restricted Securities. Each Fund may invest in restricted securities, including
- ---------------------
securities eligible for resale pursuant to Rule 144A under the Securities Act
of 1933 (the "1933 Act"). Generally, Rule 144A establishes a safe harbor from
the registration requirements of the 1933 Act for resale by large institutional
investors of securities not publicly traded in the U.S. Each Fund's investment
adviser determines the liquidity of Rule 144A securities according to
guidelines and procedures adopted by Evergreen Equity Trust's Board of
Trustees. The Board of Trustees monitors the investment adviser's application
of those guidelines and procedures. Securities eligible for resale pursuant to
Rule 144A, which the Fund's investment adviser has determined to be liquid or
readily marketable, are not subject to the 15% limit on illiquid securities.

Options and Futures. The Funds may engage in options and futures transactions.
- -------------------
Options and futures transactions are intended to enable a Fund to manage
market, interest rate or exchange rate risk. The Funds do not use these
transactions for speculation or leverage.

The Funds may attempt to hedge all or a portion of their portfolios
through the purchase of both put and call options on their portfolio securities
and listed put options on financial futures contracts for portfolio securities.
The Funds may also purchase call options on financial futures contracts. The
Funds may write covered call options on their portfolio securities to attempt
to increase their current income. The Funds will maintain their positions in

11
<PAGE>

securities, option rights, and segregated cash subject to puts and calls until
the options are exercised, closed, or have expired. An option position may be
closed out only on an exchange which provides a secondary market for an option
of the same series.

The Funds may write (i.e., sell) covered call and put options. By writing
a call option, a Fund becomes obligated during the term of the option to
deliver the securities underlying the option upon payment of the exercise
price. By writing a put option, a Fund becomes obligated during the term of the
option to purchase the securities underlying the option at the exercise price
if the option is exercised. The Funds also may write straddles (combinations of
covered puts and calls on the same underlying security). The Funds may only
write "covered" options. This means that so long as a Fund is obligated as the
writer of a call option, it will own the underlying securities subject to the
option or, in the case of call options on U.S. Treasury bills, the Fund might
own substantially similar U.S. Treasury bills. A Fund will be considered
"covered" with respect to a put option it writes if, so long as it is obligated
as the writer of the put option, it deposits and maintains with its custodian
in a segregated account liquid assets having a value equal to or greater than
the exercise price of the option.

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

A futures contract is a firm commitment by two parties: the seller, who
agrees to make delivery of the specific type of instrument called for in the
contract ("going short"), and the buyer, who agrees to take delivery of the
instrument ("going long") at a certain time in the future. Financial futures
contracts call for the delivery of particular debt instruments issued or
guaranteed by the U.S. Treasury or by specified agencies or instrumentalities
of the U.S. government. If a Fund enters into financial futures contracts
directly to hedge its holdings of fixed income securities, it would enter into
contracts to deliver securities at an undetermined price (i.e., "go short") to
protect itself against the possibility that the prices of its fixed income
securities may decline during the Fund's anticipated holding period. A Fund
would agree to purchase securities in the future at a predetermined price
(i.e., "go long") to hedge against a decline in market interest rates.

The Funds may also enter into currency and other financial futures
contracts and write options on such contracts. The Funds intend to enter into
such contracts and related options for hedging purposes. The Funds will enter
into futures on securities, currencies, or index-based futures contracts in
order to hedge against changes in interest or exchange rates or securities
prices. A futures contract on securities or currencies is an agreement to buy
or sell securities or currencies during a designated month at whatever price
exists at that time. A futures contract on a securities index does not involve
the actual delivery of securities, but merely requires the payment of a cash
settlement based on changes in the securities index. The Funds do not make
payment or deliver securities upon entering into a futures contract. Instead,
they put down a margin deposit, which is adjusted to reflect changes in the
value of the contract and which remains in effect until the contract is
terminated.

The Funds may sell or purchase currency and other financial futures
contracts. When a futures contract is sold by a Fund, the profit on the
contract will tend to rise when the value of the underlying securities or
currencies declines and to fall when the value of such securities or currencies
increases. Thus, the Funds sell futures contracts in order to offset a possible
decline in the profit on their securities or currencies. If a futures contract
is purchased by a Fund, the value of the contract will tend to rise when the
value of the underlying securities or currencies increases and to fall when the
value of such securities or currencies declines.

The Funds may enter into closing purchase and sale transactions in order
to terminate a futures contract and may buy or sell put and call options for
the purpose of closing out their options positions. The Funds' ability to enter
into closing transactions depends on the development and maintenance of a
liquid secondary market. There is no assurance that a liquid secondary market
will exist for any particular contract or at any particular time. As a result,
there can be no assurance that the Funds will be able to enter into an
offsetting transaction with respect to a particular contract at a particular
time. If the Funds are not able to enter into an offsetting transaction, the
Funds will continue to be required to maintain the margin deposits on the
contract and to complete the contract according to its terms, in which case
they would continue to bear market risk on the transaction.

12
<PAGE>

Risk Characteristics of Options and Futures. Although options and futures
- -------------------------------------------
transactions are intended to enable the Funds to manage market, exchange, or
interest rate risks, these investment devices can be highly volatile, and the
Funds' use of them can result in poorer performance (i.e., the Funds' returns
may be reduced). The Funds' attempt to use such investment devices for hedging
purposes may not be successful. Successful futures strategies require the
ability to predict future movements in securities prices, interest rates and
other economic factors. When the Funds use financial futures contracts and
options on financial futures contracts as hedging devices, there is a risk that
the prices of the securities subject to the financial futures contracts and
options on financial futures contracts may not correlate perfectly with the
prices of the securities in the Funds' portfolios. This may cause the financial
futures contracts and any related options to react to market changes
differently than the portfolio securities. In addition, a Fund's investment
adviser could be incorrect in its expectations and forecasts about the
direction or extent of market factors, such as interest rates, securities price
movements, and other economic factors. Even if a Fund's investment adviser
correctly predicts interest rate movements, a hedge could be unsuccessful if
changes in the value of a Fund's futures position did not correspond to changes
in the value of its investments. In these events, the Fund may lose money on
the financial futures contracts or the options on financial futures contracts.
It is not certain that a secondary market for positions in financial futures
contracts or for options on financial futures contracts will exist at all
times. Although a Fund's investment adviser will consider liquidity before
entering into financial futures contracts or options on financial futures
contracts, there is no assurance that a liquid secondary market on an exchange
will exist for any particular financial futures contract or option on a
financial futures contract at any particular time. The Funds' ability to
establish and close out financial futures contracts and options on financial
futures contract positions depends on this secondary market. If a Fund is
unable to close out its position due to disruptions in the market or lack of
liquidity, the Fund may lose money on the futures contract or option, and the
losses to the Fund could be significant.

Derivatives. Derivatives are financial contracts, such as those described
- -----------
above, whose value is based on an underlying asset, such as a stock or a bond,
or an underlying economic factor, such as an index or an interest rate.

The Funds may invest in derivatives only if the expected risks and rewards
are consistent with their objectives and policies.

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

Investment in Small Companies. Investments in securities of little-known,
- -----------------------------
relatively small and special situation companies may tend to be speculative and
volatile. A lack of management depth in such companies could increase the risks
associated with the loss of key personnel. Also, the material and financial
resources of such companies may be limited, with the consequence that funds or
external financing necessary for growth may be unavailable. Such companies may
also be involved in the development or marketing of new products or services
for which there are no established markets. If projected markets do not
materialize or only regional markets develop, such companies may be adversely
affected or may be subject to the consequences of local events. Moreover, such
companies may be insignificant factors in their industries and may become
subject to intense competition from larger companies. Securities of companies
in which the Funds may invest will frequently be traded only in the
over-the-counter market or on regional stock exchanges and will often be
closely held. Securities of this type may have limited liquidity and may be
subject to wide price fluctuations. As a result of the risk factors described
above, the net asset value of each Fund's shares can be expected to vary
significantly. Accordingly, each Fund should not be considered suitable for
investors who are unable or unwilling to assume the associated risks, nor
should investment in the Funds be considered a balanced or complete investment
program.

Foreign Investments. Foreign securities may involve additional risks.
- -------------------
Specifically, they may be affected by the strength of foreign currencies
relative to the U.S. dollar, or by political or economic developments in
foreign countries. Accounting procedures and government supervision may be less
stringent than those applicable to U.S. companies. There may be less publicly
available information about a foreign company than about a U.S. company.
Foreign markets may be less liquid or more volatile than U.S. markets and may
offer less protection to investors. It may also be more difficult to enforce
contractual obligations abroad than would be the case in the U.S. because of
differences in the

13
<PAGE>

legal systems. Foreign securities may be subject to foreign taxes, which may
reduce yield, and may be less marketable than comparable U.S. securities. All
these factors are considered by the investment adviser of Evergreen Omega Fund
and Evergreen Small Company Growth Fund before making any of these types of
investments.

Foreign Currency Transactions. As discussed above, Evergreen Omega Fund and
- -----------------------------
Evergreen Small Company Growth Fund may invest in securities of foreign
issuers. When the Funds invest in foreign securities, they usually will be
denominated in foreign currencies, and the Funds temporarily may hold funds in
foreign currencies. Thus, the value of Fund shares will be affected by changes
in exchange rates.

As one way of managing exchange rate risk, in addition to entering into
currency futures contracts, the Funds may enter into forward currency exchange
contracts (agreements to purchase or sell currencies at a specified price and
date). The exchange rate for the transaction (the amount of currency the Funds
will deliver or receive when the contract is completed) is fixed when the Funds
enter into the contract. The Funds usually will enter into these contracts to
stabilize the U.S. dollar value of a security they have agreed to buy or sell.
The Funds intend to use these contracts to hedge the U.S. dollar value of a
security they already own, particularly if the Funds expect a decrease in the
value of the currency in which the foreign security is denominated. Although
the Funds will attempt to benefit from using forward contracts, the success of
their hedging strategy will depend on the investment adviser's ability to
predict accurately the future exchange rates between foreign currencies and the
U.S. dollar. The value of the Funds' investments denominated in foreign
currencies will depend on the relative strength of those currencies and the
U.S. dollar, and the Funds may be affected favorably or unfavorably by changes
in the exchange rates or exchange control regulations between foreign
currencies and the U.S. dollar. Changes in foreign currency exchange rates also
may affect the value of dividends and interest earned, gains and losses
realized on the sale of securities and net investment income and gains, if any,
to be distributed to shareholders by the Funds. Although the Funds do not
currently intend to do so, they may also purchase and sell options related to
foreign currencies. The Funds do not intend to enter into foreign currency
transactions for speculation or leverage.

- --------------------------------------------------------------------------------
ORGANIZATION AND SERVICE PROVIDERS
- --------------------------------------------------------------------------------
ORGANIZATION

Fund Structure. Each Fund is an investment pool, which invests shareholders'
money toward a specified goal. In technical terms, each Fund is a diversified
series of an open-end, management investment company, called Evergreen Equity
Trust (the "Trust"). The Trust is a Delaware business trust organized on
September 17, 1997.

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

Shareholder Rights. All shareholders of a given class participate equally in
- ------------------
dividends and distributions from the Funds' assets and have equal liquidation
and other rights. Shareholders may exchange shares as described under
"Exchanges," but will have no other preference, conversion, exchange or
preemptive rights. When issued and paid for, shares will be fully paid and
nonassessable. Shares of the Funds are redeemable, transferable and freely
assignable as collateral. The Funds may establish additional classes or series
of shares.

The Funds do not hold annual shareholder meetings; a Fund may, however,
hold special meetings for such purposes as electing or removing Trustees,
changing fundamental policies and approving investment advisory agreements or
12b-1 plans. In addition, the Funds are prepared to assist shareholders in
communicating with one another for the purpose of convening a meeting to elect
Trustees. If any matters are to be voted on by shareholders, each share owned
as of the record date for the meeting would be entitled to one vote for each
dollar of net asset value applicable to each share.

14
<PAGE>

SERVICE PROVIDERS

Investment Advisers. The investment adviser of Evergreen Fund and Evergreen
Micro Cap Fund is Evergreen Asset Management Corp. ("Evergreen Asset"), which
is a wholly-owned subsidiary of First Union Corporation ("First Union").
Evergreen Asset, with its predecessors, has served as investment adviser to the
Evergreen mutual funds since 1971.

Evergreen Asset is entitled to receive from Evergreen Fund and Evergreen
Micro Cap Fund an annual fee equal to 1.00% of average daily net assets of each
Fund on the first $750,000,000, plus 0.90% of average daily net assets on the
next $250,000,000, plus 0.80% of average daily net assets on assets over
$1,000,000,000.

The Capital Management Group of First Union National Bank ("CMG") serves
as investment adviser to Evergreen Aggressive Growth Fund.

CMG receives an annual fee from Evergreen Aggressive Growth Fund equal to
0.60% of average daily net assets of the Fund.

The investment adviser to Evergreen Omega Fund and Evergreen Small Company
Growth Fund is Keystone Investment Management Company ("Keystone"). Keystone
has provided investment advisory and management services to investment
companies and private accounts since it was organized in 1932. Keystone is an
indirect subsidiary of First Union National Bank ("FUNB"). FUNB is a subsidiary
of First Union. Both FUNB and First Union are located at 201 South College
Street, Charlotte, North Carolina 28288-0630. First Union and its subsidiaries
provide a broad range of financial services to individuals and businesses
throughout the United States.

Evergreen Omega Fund pays Keystone a fee, calculated on an annual basis,
equal to 0.75% of the first $250,000,000 of average daily net assets, plus
0.675% of the next $250,000,000 of average daily net assets, plus 0.60% of the
next $500,000,000 of average daily net assets, plus 0.50% of amounts over
$1,000,000,000 of average daily net assets, computed as of the close of
business each business day and paid monthly.

Evergreen Small Company Growth Fund pays Keystone a fee, calculated on an
annual basis, equal to 0.70% of the first $100,000,000 of the aggregate net
asset value of the shares of the Fund, plus 0.65% of the next $100,000,000,
plus 0.60% of the next $100,000,000, plus 0.55% of the next $100,000,000, plus
0.50% of the next $100,000,000, plus 0.45% of the next $500,000,000, plus 0.40%
of the next $500,000,000, plus 0.35% of amounts over $1,500,000,000, computed
as of the close of business each business day and paid monthly.

Portfolio Managers. The portfolio manager for Evergreen Fund is Stephen A.
- ------------------
Lieber, who is Chairman and Co-Chief Executive of Evergreen Asset. Mr. Lieber
is the founder of Evergreen Asset and has been associated with Evergreen Asset
and its predecessor since 1971.

The portfolio manager for Evergreen Aggressive Growth Fund is Harold J.
Ireland, Jr., a Vice President of CMG who has been associated with CMG since
1995. Prior to that, Mr. Ireland was at Palm Beach Capital Management, Inc. and
served as portfolio manager of the Fund's predecessor, ABT Emerging Growth
Fund, since 1985.

The portfolio of Evergreen Micro Cap Fund is managed by a committee, which
includes Stephen A. Lieber and Nola Maddox Falcone, President and Co-Chief
Executive Officer of Evergreen Asset, together with portfolio management and
analytical personnel employed by Evergreen Asset or its affiliates.

Maureen E. Cullinane has been Evergreen Omega Fund's portfolio manager
since 1989. Ms. Cullinane is a Keystone Senior Vice President and Senior
Portfolio Manager and has more than 20 years of investment experience.

The portfolio manager of Evergreen Small Company Growth Fund is J. Gary
Craven, who joined Keystone in November, 1996. Mr. Craven is currently a
Keystone Senior Vice President, Chief Investment Officer and Group Leader for
the small cap equity area. Prior to joining Keystone, Mr. Craven was a
portfolio manager at Invista Capital Management, Inc. since 1987.

15
<PAGE>

Sub-adviser. Evergreen Asset has entered into sub-advisory agreements with
- -----------
Lieber & Company, an indirect wholly-owned subsidiary of First Union, which
provide that Lieber & Company's research department and staff will furnish
Evergreen Asset with information, investment recommendations, advice and
assistance, and will generally be available for consultation on the portfolios
of Evergreen Fund and Evergreen Micro Cap Fund. Lieber & Company will be
reimbursed by Evergreen Asset in connection with the rendering of services on
the basis of the direct and indirect costs of performing such service. There is
no additional charge to the Funds for the services provided by Lieber &
Company.

Transfer Agent and Dividend Disbursing Agent. Evergreen Service Company
- --------------------------------------------
("ESC"), 200 Berkeley Street, Boston, Massachusetts 02116, acts as the Funds'
transfer agent and dividend disbursing agent. ESC is an indirect, wholly-owned
subsidiary of First Union.

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

Principal Underwriter. Evergreen Distributor, Inc. ("EDI"), a subsidiary of The
- ---------------------
BISYS Group, Inc., located at 125 West 55th Street, New York, New York 10019,
is the principal underwriter of the Funds.

Administrator. Evergreen Investment Services, Inc. ("EIS") serves as
- -------------
administrator to Evergreen Aggressive Growth Fund. As administrator, and
subject to the supervision and control of the Trust's Board of Trustees, EIS
provides the Fund with facilities, equipment and personnel. For its services as
administrator, EIS is entitled to receive a fee based on the aggregate average
daily net assets of the Fund at a rate based on the total assets of all mutual
funds advised by First Union subsidiaries. The administration fee is calculated
in accordance with the following schedule.

<TABLE>
<S> <C>
Administration Fee
- ------------------------
0.050% on the first $7 billion
0.035% on the next $3 billion
0.030% on the next $5 billion
0.020% on the next $10 billion
0.015% on the next $5 billion
0.010% on assets in excess of $30 billion
</TABLE>

- --------------------------------------------------------------------------------
PURCHASE AND REDEMPTION OF SHARES
- --------------------------------------------------------------------------------
HOW TO BUY SHARES

Class Y shares are offered at net asset value without a front-end sales
charge or a contingent deferred sales load. Class Y shares are only offered to
(1) persons who at or prior to December 31, 1994 owned shares in a mutual fund
advised by Evergreen Asset, (2) certain institutional investors and (3)
investment advisory clients of FUNB, Evergreen Asset, Keystone, or their
affiliates.

Eligible investors may purchase Class Y shares of a Fund through
broker-dealers, banks or other financial intermediaries, or directly through
EDI. In addition, you may purchase Class Y shares of a Fund by mailing to the
Fund, c/o ESC, P.O. Box 2121, Boston, Massachusetts 02106-2121, a completed
application and a check payable to the Fund. You may also telephone
1-800-343-2898 to obtain the number of an account to which you can wire or
electronically transfer funds and then send in a completed application. The
minimum initial investment is $1,000, which may be waived in certain
situations. Subsequent investments in any amount may be made by check, by
wiring federal funds, by direct deposit or by an electronic funds transfer.

There is no minimum amount for subsequent investments. Investments of $25
or more are allowed under the Systematic Investment Plan. See the application
for more information. Only Class Y shares are offered through this prospectus.
(See "General Information -- Other Classes of Shares.")

How the Funds Value Their Shares. The net asset value of each class of shares
- --------------------------------
of a Fund is calculated by dividing the value of the amount of the Fund's net
assets attributable to that class by the number of outstanding shares of that
class. Shares are valued each day the New York Stock Exchange (the "Exchange")
is open as of the close

16
<PAGE>

of regular trading (currently 4:00 p.m. eastern time). The securities in a Fund
are valued at their current market values determined on the basis of market
quotations or, if such quotations are not readily available, such other methods
as the Trustees believe would accurately reflect fair value.

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

HOW TO REDEEM SHARES

You may "redeem" (i.e., sell) your Class Y shares in a Fund to the Fund
for cash at their net redemption value on any day the Exchange is open, either
directly by writing to the Fund, c/o ESC, or through your financial
intermediary. The amount you will receive is the net asset value adjusted for
fractions of a cent (less any applicable CDSC) next calculated after the Fund
receives your request in proper form. Proceeds generally will be sent to you
within seven days. However, for shares recently purchased by check, the Fund
will not send proceeds until it is reasonably satisfied that the check has been
collected (which may take up to 15 days). Once a redemption request has been
telephoned or mailed, it is irrevocable and may not be modified or canceled.

Redeeming Shares Through Your Financial Intermediary. A Fund must receive
- ----------------------------------------------------
instructions from your financial intermediary before 4:00 p.m. (eastern time)
for you to receive that day's net asset value (less any applicable CDSC). Your
financial intermediary is responsible for furnishing all necessary
documentation to the Fund and may charge you for this service. Certain
financial intermediaries may require that you give instructions earlier than
4:00 p.m. (eastern time).

Redeeming Shares Directly by Mail or Telephone. Send a signed letter of
- ----------------------------------------------
instruction or stock power form to a Fund, c/o ESC: the registrar, transfer
agent and dividend-disbursing agent for each Fund. Stock power forms are
available from your financial intermediary, ESC, and many commercial banks.
Additional documentation is required for the sale of shares by corporations,
financial intermediaries, fiduciaries and surviving joint owners. Signature
guarantees are required for all redemption requests for shares with a value of
more than $50,000. Currently, the requirement for a signature guarantee has
been waived on redemptions of $50,000 or less when the account address of
record has been the same for a minimum period of 30 days. The Funds and ESC
reserve the right to withdraw this waiver at any time. A signature guarantee
must be provided by a bank or trust company (not a Notary Public), a member
firm of a domestic stock exchange or by other financial institutions whose
guarantees are acceptable under the Securities Exchange Act of 1934 and ESC's
policies.

Shareholders may redeem amounts of $1,000 or more (up to $50,000) from
their accounts by calling the telephone number on the front page of this
prospectus between the hours of 8:00 a.m. and 6:00 p.m. (eastern time) each
business day (i.e., any weekday exclusive of days on which the Exchange or
ESC's offices are closed). The Exchange is closed on New Years Day, Martin
Luther King, Jr. Day, Presidents' Day, Good Friday, Memorial Day, Independence
Day, Labor Day, Thanksgiving Day and Christmas Day. Redemption requests
received after 4:00 p.m. (eastern time) will be processed using the net asset
value determined on the next business day. Such redemption requests must
include the shareholder's account name, as registered with a Fund, and the
account number. During periods of drastic economic or market changes,
shareholders may experience difficulty in effecting telephone redemptions. If
you cannot reach the Fund by telephone, you should follow the procedures for
redeeming by mail or through a broker-dealer as set forth herein. The telephone
redemption service is not made available to shareholders automatically.
Shareholders wishing to use the telephone redemption service must complete the
appropriate section on the application and choose how the redemption proceeds
are to be paid. Redemption proceeds will either (1) be mailed by check to the
shareholder at the address in which the account is registered or (2) be wired
to an account with the same registration as the shareholder's account in the
Fund at a designated commercial bank.

In order to insure that instructions received by ESC are genuine when you
initiate a telephone transaction, you will be asked to verify certain criteria
specific to your account. At the conclusion of the transaction, you will be
given a transaction number confirming your request, and written confirmation of
your transaction will be mailed the

17
<PAGE>

next business day. Your telephone instructions will be recorded. Redemptions by
telephone are allowed only if the address and bank account of record have been
the same for a minimum period of 30 days. A Fund reserves the right at any time
to terminate, suspend, or change the terms of any redemption method described
in this prospectus, except redemption by mail, and to impose fees.

Except as otherwise noted, the Funds, ESC, and EDI will not assume
responsibility for the authenticity of any instructions received by any of them
from a shareholder in writing, over the Evergreen Express Line, or by
telephone. ESC will employ reasonable procedures to confirm that instructions
received over the Evergreen Express Line or by telephone are genuine. The
Funds, ESC, and EDI will not be liable when following instructions received
over the Evergreen Express Line or by telephone that ESC reasonably believes
are genuine.

Evergreen Express Line. The Evergreen Express Line offers you specific fund
- ----------------------
account information and price and yield quotations as well as the ability to do
account transactions, including investments, exchanges and redemptions. You may
access the Evergreen Express Line by dialing toll free 1-800-346-3858 on any
touch-tone telephone, 24 hours a day, seven days a week.

General. The sale of shares is a taxable transaction for federal income tax
- -------
purposes. The Funds may temporarily suspend the right to redeem their shares
when: (1) the Exchange is closed, other than customary weekend and holiday
closings; (2) trading on the Exchange is restricted; (3) an emergency exists
and the Fund cannot dispose of its investments or fairly determine their value;
or (4) the Securities and Exchange Commission ("SEC") so orders. The Funds
reserve the right to close an account that through redemption has fallen below
$1,000 and has remained so for 30 days. Shareholders will receive 60 days'
written notice to increase the account value to at least $1,000 before the
account is closed. The Funds have elected to be governed by Rule 18f-1 under
the 1940 Act pursuant to which each Fund is obligated to redeem shares solely
in cash, up to the lesser of $250,000 or 1% of a Fund's total net assets,
during any 90 day period for any one shareholder.

EXCHANGE PRIVILEGE

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

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

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

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

18
<PAGE>

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

SHAREHOLDER SERVICES

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

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

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

Systematic Withdrawal Plan. When an account of $10,000 or more is opened or
- --------------------------
when an existing account reaches that size, you may participate in the
Systematic Withdrawal Plan by filling out the appropriate part of the
application. Under this Plan, you may receive (or designate a third party to
receive) a monthly or quarterly fixed-withdrawal payment in a stated amount of
at least $75 and as much as 1.0% per month or 3.0% per quarter of the total net
asset value of the Fund shares in your account when the Plan was opened. Fund
shares will be redeemed as necessary to meet withdrawal payments. All
participants must elect to have their dividends and capital gains distributions
reinvested automatically.

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

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

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

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

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

BANKING LAWS

The Glass-Steagall Act and other banking laws and regulations presently
prohibit member banks of the Federal Reserve System ("Member Banks") or their
non-bank affiliates from sponsoring, organizing, controlling, or distributing
the shares of registered open-end investment companies such as the Funds. Such
laws and regulations also prohibit banks from issuing, underwriting or
distributing securities in general. However, under the Glass-Steagall Act and
such other laws and regulations, a Member Bank or an affiliate thereof may act
as investment adviser,

19
<PAGE>

transfer agent or custodian to a registered open-end investment company and may
also act as agent in connection with the purchase of shares of such an
investment company upon the order of its customer. FUNB and its affiliates are
subject to and in compliance with the aforementioned laws and regulations.

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

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

Account statements and/or checks, as appropriate, will be mailed within
seven days after a Fund pays a distribution. Unless the Fund receives
instructions to the contrary before the record or payable date, as the case may
be, it will assume that a shareholder wishes to receive that distribution and
future capital gains and income distributions in shares. Instructions continue
in effect until changed in writing.

Each Fund intends to qualify as a regulated investment company under the
Internal Revenue Code of 1986, as amended (the "Code"). While so qualified, it
is expected that a Fund will not be required to pay any federal income taxes on
that portion of its investment company taxable income and any net realized
capital gains it distributes to shareholders. The Code imposes a 4%
nondeductible excise tax on regulated investment companies, such as the Funds,
to the extent they do not meet certain distribution requirements by the end of
each calendar year. The Funds anticipate meeting such distribution
requirements.

Any taxable dividend declared in October, November or December to
shareholders of record in such a month and paid by the following January 31
will be includable in the taxable income of shareholders as if paid on December
31 of the year in which the dividend was declared.

A Fund may be subject to foreign withholding taxes which would reduce the
yield on its investments. Tax treaties between certain countries and the U.S.
may reduce or eliminate such taxes. Shareholders of a Fund who are subject to
U.S. federal income tax may be entitled, subject to certain rules and
limitations, to claim a federal income tax credit or deduction for foreign
income taxes paid by the Fund. See the SAI for additional details. A Fund's
transactions in options, futures and forward contracts may be subject to
special tax rules. These rules can affect the amount, timing and
characteristics of distributions to shareholders.

Each Fund is required by federal law to withhold 31% of reportable
payments (which may include dividends, capital gains distributions (if any) and
redemptions) paid to certain shareholders. In order to avoid this backup
withholding requirement, each investor must certify on the application, or on a
separate form supplied by the Funds' transfer agent, that the investor's social
security or taxpayer identification number is correct and that the investor is
not currently subject to backup withholding or is exempt from backup
withholding.

20
<PAGE>

Each Fund intends to distribute its net capital gains as capital gains
dividends. Shareholders should treat such dividends as long-term capital gains.
A Fund will designate capital gains distributions as such by a written notice
mailed to each shareholder no later than 60 days after the close of the Fund's
taxable year. If a shareholder receives a capital gain dividend and holds his
shares for six months or less, then any allowable loss on disposition of such
shares will be treated as a long-term capital loss to the extent of such
capital gain dividend.

The foregoing discussion of federal income tax consequences is based on
tax laws and regulations in effect on the date of this prospectus and is
subject to change by legislative or administrative action. As the foregoing
discussion is for general information only, you should also review the
discussion of "Additional Tax Information" contained in the SAI. In addition,
you should consult your own tax adviser as to the tax consequences of
investments in a Fund, including the application of state and local taxes which
may be different from the federal income tax consequences described above.

GENERAL INFORMATION

Portfolio Turnover and Brokerage. The estimated annual portfolio turnover rate
for the Evergreen Fund is not expected to exceed 100%. The estimated annual
portfolio turnover rate for Evergreen Micro Cap Fund, Evergreen Aggressive
Growth Fund, Evergreen Omega Fund and Evergreen Small Company Growth Fund is
not expected to exceed 200%. A portfolio turnover rate of 100% would occur if
all of a Fund's portfolio securities were replaced in one year. The portfolio
turnover rate experienced by a Fund directly affects the transaction costs
relating to the purchase and sale of securities which the Fund bears directly.
A high rate of portfolio turnover will increase such costs. It is contemplated
that Lieber & Company, an affiliate of Evergreen Asset and a member of the New
York and American Stock Exchanges, will to the extent practicable effect
substantially all of the portfolio transactions for Evergreen Fund and
Evergreen Micro Cap Fund effected on those exchanges. See the SAI for further
information regarding the practices of the Funds affecting portfolio turnover
and brokerage allocation practices.

Portfolio Transactions. Consistent with the Conduct Rules of the National
- ----------------------
Association of Securities Dealers, Inc., and subject to seeking best price and
execution, a Fund may consider sales of its shares as a factor in the selection
of broker-dealers to enter into portfolio transactions with the Fund.

Other Classes of Shares. Each Fund currently offers four classes of shares,
- -----------------------
Class A, Class B, Class C and Class Y (except for Evergreen Strategic Growth
Fund which offers three classes of shares, Class A, Class B and Class C) and
may in the future offer additional classes. Class Y shares are the only class
of shares offered by this prospectus and are only available to (1) persons who
at or prior to December 31, 1994 owned shares in a mutual fund advised by
Evergreen Asset, (2) certain institutional investors and (3) investment
advisory clients of FUNB, Evergreen Asset, Keystone, or their affiliates. The
dividends payable with respect to Class A, Class B and Class C shares will be
less than those payable with respect to Class Y shares due to the distribution
and shareholder servicing-related expenses borne by Class A, Class B and Class
C shares and the fact that such expenses are not borne by Class Y shares.
Investors should telephone (800) 343-2898 to obtain more information on other
classes of shares.

Performance Information. From time to time, a Fund may quote its "total return"
- -----------------------
or "yield" for a specified period in advertisements, reports or other
communications to shareholders. Total return and yield are computed separately
for Class A, Class B, Class C and Class Y shares. A Fund's total return for
each such period is computed by finding, through the use of a formula
prescribed by the SEC, the average annual compounded rate of return over the
period that would equate an assumed initial amount invested to the value of the
investment at the end of the period. For purposes of computing total return,
dividends and capital gains distributions paid on shares of a Fund are assumed
to have been reinvested when paid and the maximum sales charges applicable to
purchases of the Fund's shares are assumed to have been paid.

Yield is a way of showing the rate of income a Fund earns on its
investments as a percentage of the Fund's share price. A Fund's yield is
calculated according to accounting methods that are standardized by the SEC for
all stock and bond funds. Because yield accounting methods differ from the
method used for other accounting purposes, the Fund's yield may not equal its
distribution rate, the income paid to your account or the net investment income
reported in the Fund's financial statements. To calculate yield, a Fund takes
the interest and dividend income it earned from its portfolio of investments
(as defined by the SEC formula) for a 30-day period (net of expenses),

21
<PAGE>

divides it by the average number of shares entitled to receive dividends, and
expresses the result as an annualized percentage rate based on the Fund's share
price at the end of the 30-day period. This yield does not reflect gains or
losses from selling securities.

Performance data may be included in any advertisement or sales literature
of a Fund. These advertisements may quote performance rankings or ratings of
the Fund by financial publications or independent organizations such as Lipper
Analytical Services, Inc. and Morningstar, Inc. or compare the Fund's
performance to various indices. A Fund may also advertise in items of sales
literature an "actual distribution rate" which is computed by dividing the
total ordinary income distributed (which may include the excess of short-term
capital gains over losses) to shareholders for the latest 12-month period by
the maximum public offering price per share on the last day of the period.
Investors should be aware that past performance may not be indicative of future
results.

In marketing a Fund's shares, information may be provided that is designed
to help individuals understand their investment goals and explore various
financial strategies. Such information may include publications describing
general principles of investing, such as asset allocation, diversification,
risk tolerance, and goal setting; a questionnaire designed to help create a
personal financial profile; and an action plan offering investment
alternatives. The information provided to investors may also include
discussions of other Evergreen funds, products, and services, which may
include: retirement investing; brokerage products and services; the effects of
periodic investment plans and dollar cost averaging; saving for college; and
charitable giving. In addition, the information provided to investors may quote
financial or business publications and periodicals, including model portfolios
or allocations, as they relate to fund management, investment philosophy, and
investment techniques. The materials may also reprint, and use as advertising
and sales literature, articles from Evergreen Events, a quarterly magazine
provided free of charge to Evergreen fund shareholders.

Additional Information. This prospectus and the SAI, which has been
- ----------------------
incorporated by reference herein, do not contain all the information set forth
in the Registration Statement filed by the Trust with the SEC under the
Securities Act of 1933, as amended. Copies of the Registration Statement may be
obtained at a reasonable charge from the SEC or may be examined, without
charge, at the offices of the SEC in Washington, D.C.

22
<PAGE>

Investment Adviser
Evergreen Asset Management Corp., 2500 Westchester Avenue, Purchase, New York
10577
Evergreen Fund, Evergreen Micro Cap Fund

Capital Management Group of First Union National Bank, 201 South College
Street, Charlotte, North Carolina 28288
Evergreen Aggressive Growth Fund

Keystone Investment Management Company, 200 Berkeley Street, Boston,
Massachusetts 02116-5034
Evergreen Omega Fund
Evergreen Small Company Growth Fund

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

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

Legal Counsel
Sullivan & Worcester LLP, 1025 Connecticut Avenue, N.W., Washington, D.C. 20036

Independent Auditors
Price Waterhouse LLP, 1177 Avenue of the Americas, New York, New York 10036
Evergreen Fund, Evergreen Micro Cap Fund, Evergreen Aggressive Growth Fund

KPMG Peat Marwick LLP, 99 High Street, Boston, Massachusetts 02110
Evergreen Omega Fund, Evergreen Small Company Growth Fund

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

65140
542080
<PAGE>

EVERGREEN EQUITY TRUST

PART B

STATEMENT OF ADDITIONAL INFORMATION

<PAGE>
EVERGREEN EQUITY TRUST

200 BERKELEY STREET
BOSTON, MASSACHUSETTS 02116
(800) 633-2700

DOMESTIC GROWTH FUNDS

STATEMENT OF ADDITIONAL INFORMATION

FEBRUARY 1, 1998

EVERGREEN FUND ("EVERGREEN")
EVERGREEN MICRO CAP FUND ("MICRO")
EVERGREEN AGGRESSIVE GROWTH FUND ("AGGRESSIVE")
EVERGREEN OMEGA FUND ("OMEGA")
EVERGREEN SMALL COMPANY GROWTH FUND ("SMALL")
EVERGREEN STRATEGIC GROWTH FUND ("STRATEGIC")
(EACH A "FUND"; TOGETHER, THE "FUNDS")

EACH FUND IS A SERIES OF AN OPEN-END
MANAGEMENT INVESTMENT COMPANY KNOWN AS
EVERGREEN EQUITY TRUST (THE "TRUST").

This Statement of Additional Information ("SAI") pertains to all
classes of shares of the Funds listed above. It is not a prospectus and should
be read in conjunction with the Funds' prospectuses dated February 1, 1998, as
supplemented from time to time. The Funds are offered through two separate
prospectuses: one offering Class A, Class B and Class C shares of each Fund and
one offering Class Y shares of all but Strategic. You may obtain any of these
prospectuses from Evergreen Distributor, Inc.

23281

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TABLE OF CONTENTS

FUND INVESTMENTS..........................................................3
General Information............................................3
Fundamental Policies.............................................8
Investment Guidelines............................................9
MANAGEMENT OF THE TRUST..................................................11
PRINCIPAL HOLDERS OF FUND SHARES.........................................13
INVESTMENT ADVISORY AND OTHER SERVICES...................................17
Investment Adviser..............................................17
Investment Advisory Agreements..................................17
Distributor.....................................................18
Distribution Plans and Agreements...............................18
Additional Service Providers................................... 20
BROKERAGE................................................................20
Brokerage Commissions...........................................21
Selection of Brokers............................................21
Simultaneous Transactions.......................................22
TRUST ORGANIZATION.......................................................22
Form of Organization............................................22
Description of Shares...........................................22
Voting Rights...................................................22
Limitation of Trustees' Liability...............................23
PURCHASE, REDEMPTION AND PRICING OF SHARES...............................23
How the Funds Offer Shares to the Public........................23
Contingent Deferred Sales Charge..............................24
Sales Charge Waivers or Reductions..............................24
Exchanges.......................................................27
Calculation of Net Asset Value Per Share........................27
Valuation of Portfolio Securities...............................27
Shareholder Services............................................28
PRINCIPAL UNDERWRITER....................................................28
ADDITIONAL TAX INFORMATION...............................................29
Requirements for Qualification as a
Registered Investment Company..................................29
Taxes on Distributions.........................................30
Taxes on the Sale or Exchange of Fund Shares...................30
Other Tax Considerations.......................................31
FINANCIAL INFORMATION....................................................31
Expenses........................................................31
Brokerage Commissions Paid......................................33
Computation of Class A Offering Price...........................33
Performance.....................................................34
ADDITIONAL INFORMATION...................................................36
APPENDIX A...............................................................A-1

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<PAGE>

FUND INVESTMENTS

GENERAL INFORMATION

The investment objective of each Fund and a description of the
securities in which each Fund may invest are set forth in each Fund's
prospectus. The following expands upon the discussion in the prospectuses
regarding certain investments of the Fund.

U.S. Government Securities

Each Fund may invest in securities issued or guaranteed by U.S.
Government agencies or instrumentalities.

These securities are backed by (1) the discretionary authority of the
U.S. Government to purchase certain obligations of agencies or instrumentalities
or (2) the credit of the agency or instrumentality issuing the obligations.

Some government agencies and instrumentalities may not receive
financial support from the U.S. Government. Examples of such agencies are:

(i) Farm Credit System, including the National Bank for
Cooperatives, Farm Credit Banks and Banks for Cooperatives;

(ii) Farmers Home Administration;

(iii) Federal Home Loan Banks;

(iv) Federal Home Loan Mortgage Corporation;

(v) Federal National Mortgage Association; and

(vi) Student Loan Marketing Association.

Securities Issued by the Government National Mortgage Association ("GNMA")

The Funds may invest in securities issued by the GNMA, a corporation
wholly-owned by the U.S. Government. GNMA securities or "certificates" represent
ownership in a pool of underlying mortgages. The timely payment of principal and
interest due on these securities is guaranteed.

Unlike conventional bonds, the principal on GNMA certificates is not
paid at maturity but over the life of the security in scheduled monthly
payments. While mortgages pooled in a GNMA certificate may have maturities of up
to 30 years, the certificate itself will have a shorter average maturity and
less principal volatility than a comparable 30-year bond.

The market value and interest yield of GNMA certificates can vary due
not only to market fluctuations, but also to early prepayments of mortgages
within the pool. Since prepayment rates vary widely, it is impossible to
accurately predict the average maturity of a GNMA pool. In addition to the
guaranteed principal payments, GNMA certificates may also make unscheduled
principal payments resulting from prepayments on the underlying mortgages.

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<PAGE>

Although GNMA certificates may offer yields higher than those available
from other types of U.S. Government securities, they may be less effective as a
means of locking in attractive long-term rates because of the prepayment
feature. For instance, when interest rates decline, prepayments are likely to
increase as the holders of the underlying mortgages seek refinancing. As a
result, the value of a GNMA certificate is not likely to rise as much as the
value of a comparable debt security would in response to same decline. In
addition, these prepayments can cause the price of a GNMA certificate originally
purchased at a premium to decline in price compared to its par value, which may
result in a loss.

When-Issued, Delayed-Delivery and Forward Commitment Transactions

The Funds may purchase securities on a when-issued or delayed delivery
basis and may purchase or sell securities on a forward commitment basis.
Settlement of such transactions normally occurs within a month or more after the
purchase or sale commitment is made.

The Funds may purchase securities under such conditions only with the
intention of actually acquiring them, but may enter into a separate agreement to
sell the securities before the settlement date. Since the value of securities
purchased may fluctuate prior to settlement, a Fund may be required to pay more
at settlement than the security is worth. In addition, the purchaser is not
entitled to any of the interest earned prior to settlement.

Upon making a commitment to purchase a security on a when-issued,
delayed delivery or forward commitment basis, a Fund will hold liquid assets
worth at least the equivalent of the amount due. The liquid assets will be
monitored on a daily basis and adjusted as necessary to maintain the necessary
value.

Purchases made under such conditions are a form of leveraging and may
involve the risk that yields secured at the time of commitment may be lower than
otherwise available by the time settlement takes place, causing an unrealized
loss to the fund. In addition, when a Fund engages in such purchases, it relies
on the other party to consummate the sale. If the other party fails to perform
its obligations, the Fund may miss the opportunity to obtain a security at a
favorable price or yield.

Loans of Securities

To generate income, each Fund may lend to broker-dealers and other
financial institutions portfolio securities valued at up to 30% of a Fund's
total assets. A Fund will require borrowers to provide collateral in cash or
government securities at least equal to the value of the securities loaned. A
Fund may invest such collateral in additional portfolio securities, such as U.S.
Treasury notes, certificates of deposit, other high-grade, short-term
obligations or interest-bearing cash equivalents. While securities are on loan,
the borrower will pay a Fund any income accruing on the security.

Each Fund may make loans only to borrowers which meet credit standards
set by the Board of Trustees. Income to be earned from the loan must justify the
attendant risks. If a borrower fails financially, a Fund may have difficulty
recovering the securities lent or may lose its right to the collateral.

Each Fund has the right to call a loan and obtain the securities lent
upon giving notice of not more than five business days.

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<PAGE>

Repurchase Agreements

The Funds may enter into repurchase agreements with entities that are
registered as U.S. Government securities dealers, including member banks of the
Federal Reserve System having at least $1 billion in assets, primary dealers in
U.S. Government securities or other financial institutions believed by the
Adviser (as defined later) to be creditworthy. In a repurchase agreement, a Fund
obtains a security and simultaneously commits to return the security to the
seller at a set price (including principal and interest) within period of time
usually not exceeding seven days. The resale price reflects the purchase price
plus an agreed upon market rate of interest which is unrelated to the coupon
rate or maturity of the underlying security. A repurchase agreement involves the
obligation of the seller to pay the agreed upon price, which obligation is in
effect secured by the value of the underlying security.

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

Reverse Repurchase Agreements

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

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

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

Options (Evergreen, Omega, Small and Strategic)

The Funds may buy or sell (i.e., write) put and call options on
securities it holds or intends to acquire. The Funds may also buy and sell
options on financial futures contracts. The Funds will use options as a hedge
against decreases or increases in the value of securities it holds or intends to
acquire. The Funds may purchase put and call options for the purpose of
offsetting previously written put and call options of the same series.

23281
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<PAGE>

The Funds may write only covered options. With regard to a call option,
this means that a Fund will own, for the life of the option, the securities
subject to the call option. Each Fund will cover put options by holding, in a
segregated account, liquid assets having a value equal to or greater than the
price of securities subject to the put option. If a Fund is unable to effect a
closing purchase transaction with respect to the covered options it has sold, it
will not be able to sell the underlying securities or dispose of assets held in
a segregated account until the options expire or are exercised.

Futures Transactions (Evergreen, Omega, Small and Strategic)

Each Fund may enter into financial futures contracts and write options
on such contracts. Each Fund intends to enter into such contracts and related
options for hedging purposes. Each Fund will enter into futures contracts on
securities or indices in order to hedge against changes in interest or exchange
rates or securities prices. A futures contract on securities is an agreement to
buy or sell securities at a specified price during a designated month. A futures
contract on a securities index does not involve the actual delivery of
securities, but merely requires the payment of a cash settlement based on
changes in the securities index. A Fund does not make payment or deliver
securities upon entering into a futures contract. Instead, it puts down a margin
deposit, which is adjusted to reflect changes in the value of the contract and
which continues until the contract is terminated.

Each Fund may sell or purchase futures contracts. When a futures
contract is sold by a Fund, the value of the contract will tend to rise when the
value of the underlying securities declines and to fall when the value of such
securities increases. Thus, each Fund sells futures contracts in order to offset
a possible decline in the value of its securities. If a futures contract is
purchased by a Fund, the value of the contract will tend to rise when the value
of the underlying securities increases and to fall when the value of such
securities declines. Each Fund intends to purchase futures contracts in order to
establish what is believed by the Adviser to be a favorable price and rate of
return for securities the Fund intends to purchase.

Each Fund also intends to purchase put and call options on futures
contracts for hedging purposes. A put option purchased by a Fund would give it
the right to assume a position as the seller of a futures contract. A call
option purchased by a Fund would give it the right to assume a position as the
purchaser of a futures contract. The purchase of an option on a futures contract
requires a Fund to pay a premium. In exchange for the premium, a Fund becomes
entitled to exercise the benefits, if any, provided by the futures contract, but
is not required to take any action under the contract. If the option cannot be
exercised profitably before it expires, a Fund's loss will be limited to the
amount of the premium and any transaction costs.

Each Fund may enter into closing purchase and sale transactions in
order to terminate a futures contract and may sell put and call options for the
purpose of closing out its options positions. A Fund's ability to enter into
closing transactions depends on the development and maintenance of a liquid
secondary market. There is no assurance that a liquid secondary market will
exist for any particular contract or at any particular time. As a result, there
can be no assurance that a Fund will be able to enter into an offsetting
transaction with respect to a particular contract at a particular time. If a
Fund is not able to enter into an offsetting transaction, the Fund will continue
to be required to maintain the margin deposits on the contract and to complete
the contract according to its terms, in which case it would continue to bear
market risk on the transaction.

Although futures and options transactions are intended to enable a Fund
to manage market

23281
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<PAGE>

or interest rate risk, unanticipated changes in interest rates or market prices
could result in poorer performance than if it had not entered into these
transactions. Even if the Adviser correctly predicts interest rate movements, a
hedge could be unsuccessful if changes in the value of a Fund's futures position
did not correspond to changes in the value of its investments. This lack of
correlation between a Fund's futures and securities positions may be caused by
differences between the futures and securities markets or by differences between
the securities underlying a Fund's futures position and the securities held by
or to be purchased for a Fund. Each Fund's Adviser will attempt to minimize
these risks through careful selection and monitoring of the Fund's futures and
options positions.

The Funds do not intend to use futures transactions for speculation or
leverage. Each Fund has the ability to write options on futures, but currently
intends to write such options only to close out options purchased by a Fund.
Each Fund will not change these policies without supplementing the information
in the prospectus and SAI.

The Funds will not maintain open positions in futures contracts it has
sold or call options it has written on futures contracts if, in the aggregate,
the value of the open positions (marked to market) exceeds the current market
value of its securities portfolio plus or minus the unrealized gain or loss on
those open positions, adjusted for the correlation of volatility between the
hedged securities and the futures contracts. If this limitation is exceeded at
any time, each Fund will take prompt action to close out a sufficient number of
open contracts to bring its open futures and options positions within this
limitation.

"Margin" in Futures Transactions (Evergreen, Omega, Small and Strategic)

Unlike the purchase or sale of a security, the Funds do not pay or
receive money upon the purchase or sale of a futures contract. Rather, each Fund
is required to deposit an amount of "initial margin" in cash or U.S. Treasury
bills with its custodian (or the broker, if legally permitted). The nature of
initial margin in futures transactions is different from that of margin in
securities transactions in that futures contract initial margin does not involve
the borrowing of funds by a Fund to finance the transactions. Initial margin is
in the nature of a performance bond or good faith deposit on the contract which
is returned to a Fund upon termination of the futures contract, assuming all
contractual obligations have been satisfied.

A futures contract held by a Fund is valued daily at the official
settlement price of the exchange on which it is traded. Each day, a Fund pays or
receives cash, called "variation margin", equal to the daily change in value of
the futures contract. This process is known as "marking to market". Variation
margin does not represent a borrowing or loan by a Fund but is instead
settlement between the Fund and the broker of the amount one would owe the other
if the futures contract expired. In computing its daily net asset value, a Fund
will mark-to-market its open futures positions. The Funds are also required to
deposit and maintain margin when it writes call options on futures contracts.

Foreign Securities (Omega, Small and Strategic)

Each Fund may invest in foreign securities or U.S. securities traded in
foreign markets. Permissible investments may consist of obligations of foreign
branches of U.S. banks and of foreign banks, including European certificates of
deposit, European time deposits, Canadian time deposits and Yankee certificates
of deposit, and investments in Canadian commercial paper, foreign securities and
Europaper. These instruments may subject a Fund to investment risks that differ
in some respects from those related to investments in obligations of U.S.
issuers. Such risks

23281
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<PAGE>

include future adverse political and economic developments; the possible
imposition of withholding taxes on interest or other income; the possible
seizure, nationalization, or expropriation of foreign deposits; the possible
establishment of exchange controls or taxation at the source; greater
fluctuations in value due to changes in exchange rates, or the adoption of other
foreign governmental restrictions which might adversely affect the payment of
principal and interest on such obligations. Such investments may also entail
higher custodial fees and sales commissions than domestic investments. Foreign
issuers of securities or obligations are often subject to accounting treatment
and engage in business practices different from those respecting domestic
issuers of similar securities or obligations. Foreign branches of U.S. banks and
foreign banks may be subject to less stringent reserve requirements than those
applicable to domestic branches of U.S. banks.

Foreign Currency Transactions (Omega, Small and Strategic)

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

FUNDAMENTAL POLICIES

The Funds have adopted the fundamental investment restrictions set
forth below which may not be changed without the vote of a majority of each
Fund's outstanding shares, as defined in the Investment Company Act of 1940 (the
"1940 Act"). Unless otherwise stated, all references to the assets of a Fund are
in terms of current market value.

Diversification

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

Concentration

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

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<PAGE>

Issuing Senior Securities

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

Borrowing

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

Underwriting

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

Real Estate

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

Commodities

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

Loans to Other Persons

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

INVESTMENT GUIDELINES

Unlike the Fundamental Policies above, the following guidelines may be
changed by the Trust's Board of Trustees without shareholder approval. Unless
otherwise stated, all references to the assets of a Fund are in terms of current
market value.

Diversification

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

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<PAGE>

Borrowings

Each Fund may borrow money from banks or enter into reverse repurchase
agreements in an amount up to one third of its total assets. Each Fund may also
borrow an additional 5% of its total assets from banks or others. Each Fund may
borrow only as a temporary measure for extraordinary or emergency purposes. Each
Fund will not purchase securities while borrowings are outstanding except to
exercise prior commitments and to exercise subscription rights. Each Fund may
obtain such short-term credit as may be necessary for the clearance of purchases
and sales of portfolio securities. Each Fund may purchase securities on margin
to the extent permitted by applicable law.

Concentration

For purposes of the investment restriction on concentration, the phrase
"securities of issuers primarily engaged in any particular industry" includes
industrial development bonds from the same facility or similar types of
facilities. Otherwise, each Fund may invest more than 25% of its assets in
industrial development bonds. Also, governmental issuers are not considered to
be members of an industry for concentration purposes.

Illiquid and Restricted Securities

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

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

Investment in Other Investment Companies

Each Fund may purchase the shares of other investment companies to the
extent permitted under the 1940 Act. Currently, each Fund may not (1) own more
than 3% of the outstanding voting stock of another investment company, (2)
invest more than 5% of its assets in any single investment company, and (3)
invest more than 10% of its assets in investment companies. However, each Fund
may invest all of its investable assets in securities of a single open-end
management investment company with substantially the same fundamental investment
objectives, policies and limitations as each Fund.

Short Sales

Each Fund may not make short sales of securities or maintain a short
position unless, at all times when a short position is open, it owns an equal
amount of such securities or of securities which, without payment of any further
consideration, are convertible into or exchangeable for

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<PAGE>

securities of the same issue as, and equal in amount to, the securities sold
short. Each Fund may effect a short sale in connection with an underwriting in
which a Fund is a participant.

MANAGEMENT OF THE TRUST

Set forth below are the Trustees and officers of the Trust and their
principal occupations and some of their affiliations over the last five years.
Unless otherwise indicated, the address for each Trustee and officer is 200
Berkeley Street, Boston, Massachusetts 02116. Each Trustee is also a Trustee of
each of the other Trusts in the Evergreen fund complex, other than Evergreen
Variable Trust of which Messrs. Howell, Salton and Scofield are the only
Trustees.

<TABLE>
<CAPTION>
NAME POSITION WITH TRUST PRINCIPAL OCCUPATIONS FOR LAST FIVE YEARS
- ------------------------------- -------------------------- -------------------------------------------------------------
<S> <C> <C>
Laurence B. Ashkin Trustee Real estate developer and construction consultant;
(DOB: 2/2/28) and President of Centrum Equities and Centrum
Properties, Inc.

Charles A. Austin III Trustee Investment Counselor to Appleton Partners, Inc.;
(DOB: 10/23/34) and former Managing Director, Seaward
Management Corporation (investment advice).

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

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

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

Gerald M. McDonnell Trustee Sales Representative with Nucor-Yamoto, Inc.
(DOB: 7/14/39) (steel producer).

Thomas L. McVerry Trustee Former Vice President and Director of Rexham
(DOB: 8/2/39) Corporation; and former Director of Carolina
Cooperative Federal Credit Union.
11

<PAGE>

NAME POSITION WITH TRUST PRINCIPAL OCCUPATIONS FOR LAST FIVE YEARS
- ------------------------------- -------------------------- -------------------------------------------------------------
*William Walt Pettit Trustee Partner in the law firm of William Walt Pettit, P.A.
(DOB: 8/26/55)

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

Russell A. Salton, III MD Trustee Medical Director, U.S. Health Care/Aetna Health
(DOB: 6/2/47) Services; former Managed Health Care Consultant;
and former President, Primary Physician Care.
Michael S. Scofield Trustee Attorney, Law Offices of Michael S. Scofield.
(DOB: 2/20/43)

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

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

George O. Martinez** Secretary Senior Vice President and Director of
(DOB: 3/11/59) Administration and Regulatory Services, BISYS
Fund Services; Vice President/Assistant General
Counsel, Alliance Capital Management from 1988
to 1995.
</TABLE>

*This Trustee may be considered an interested trustee within the meaning
of the 1940 Act.
**Address: BISYS, 3435 Stelzer Road, Columbus, Ohio 43219-8001

The officers of the Trust are all officers and/or employees of BISYS
Fund Services.

Trustee Compensation

Listed below is the Trustee compensation for the twelve-month period
ended September 30, 1997.

<PAGE>

COMPENSATION FROM
TRUSTEE COMPENSATION FROM TRUST AND FUND
TRUST COMPLEX
Laurence B. Ashkin $29,301 $63,400
Charles A. Austin III $14,709 $41,400
K. Dun Gifford $13,462 $38,700
James S. Howell $38,651 $100,542
Leroy Keith Jr. $13,504 $37,800
Gerald M. McDonnell $34,939 $87,051
Thomas L. McVerry $36,363 $91,101
William Walt Pettit $35,613 $89,101
David M. Richardson $14,709 $41,400
Russell A. Salton, III $34,876 $90,701
Michael S. Scofield $34,052 $87,801
Richard J. Shima $21,849 $61,125

PRINCIPAL HOLDERS OF FUND SHARES

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

Set forth below is information with respect to each person who, to each
Fund's knowledge, owned beneficially or of record more than 5% of a class of a
Fund's outstanding shares as of December 31, 1997.

EVERGREEN CLASS A

None

EVERGREEN CLASS B

None

EVERGREEN CLASS C

None

<PAGE>

EVERGREEN CLASS Y

First Union National Bank/EB/INT 23.667%
Reinvest Account
Attn: Trust Operations Fund Group
401 S. Tryon St. 3rd Fl CMG 1151
Charlotte, NC 28202-1911

First Union National Bank/EB/INT 8.399%
Cash Account
Attn: Trust Operations Fund Group
401 S. Tryon St. 3rd Fl CMG 1151
Charlotte, NC 28202-1911

MICRO CLASS A

Charles Schwab & Co. Inc. 6.524%
Special Custody Account for the
Exclusive Benefit of Customers
Reinvest Account Mut Fds Dept
101 Montgomery St.
San Francisco, CA 94104-4122

First Union Brokerage Services 5.787%
The B Scott White Trust
A/C 8685-5058
Rt 2 Box 181A
Castlewood, VA 24224

MICRO CLASS B

MLPF&S for the sole 6.591%
benefit of its customers.
Attn: Fund Administration
4800 Deer Lake Dr E 3rd Fl
Jacksonville, FL 32246-6484

MICRO CLASS C

None

MICRO CLASS Y

Stephen A. Lieber 12.168%
1210 Greacen Point Rd.
Mamaroneck, NY 10543-4693

Constance E. Lieber 8.705%
1210 Greacen Point Rd.
Mamaroneck, NY 10543-4693

Citibank NA 7.729%
Delta Airlines Master Trust 308235
Joe Villella Citicorp Services
1410 N. Westshore Blvd. Fl 5
Tampa, FL 33607-4519

<PAGE>

Charles Schwab & Co. Inc. 7.571%
Special Custody Account for the
Exclusive Benefit of Customers
Reinvest Account Mut Fds Dept
101 Montgomery St.
San Francisco, CA 94104-4122

OMEGA CLASS A

None

OMEGA CLASS B

MLPF&S for the sole 7.725%
benefit of its customers.
Attn: Fund Administration
4800 Deer Lake Dr E 3rd Fl
Jacksonville, FL 32246-6484

OMEGA CLASS C

MLPF&S for the sole 28.770%
benefit of its customers.
Attn: Fund Administration
4800 Deer Lake Dr E 3rd Fl
Jacksonville, FL 32246-6484

OMEGA CLASS Y

SSB C/F IRA Regular 99.550%
Nancy A. Lavalley
2048 Clairmont Terrace
Atlanta, GA 30345-2312

STRATEGIC CLASS A

None

STRATEGIC CLASS B

None

STRATEGIC CLASS C

None

AGGRESSIVE CLASS A

MLPF&S for the sole 11.525%
benefit of its customers.
Attn: Fund Administration
4800 Deer Lake Dr E 3rd Fl
Jacksonville, FL 32246-6484

AGGRESSIVE CLASS B

None

<PAGE>

AGGRESSIVE CLASS C

MLPF&S for the sole 23.805%
benefit of its customers.
Attn: Fund Administration
4800 Deer Lake Dr E 3rd Fl
Jacksonville, FL 32246-6484

Michael J. Grimaldi 7.775%
7 Edgeworth Pl.
New Brunswick, NJ 08902-3021

Lavedna Ellingson 7.255%
Douglas Ellingson Jt Wros
8510 McClintock
Tempe, AZ 85284-2527

AGGRESSIVE CLASS Y

First Union National Bank 82.163%
Trust Accounts
Attn: Ginny Batten
11th Floor, CMG-1151
301 S. Tryon St.
Charlotte, NC 28288-0002

SMALL CLASS A

N/A

SMALL CLASS B

MLPF&S For the Sole benefit of its 9.524%
customers.
Attn: Fund Administration
4800 Deer Lake Drive E, 3rd Floor
Jacksonville, FL 32246-6484

ROFE & Co. 5.394%
C/O State Street Bank & Trust Co.
For Sub Account
Kokusai Securities Co. Ltd.
P.O. Box 5061
Boston, MA 02206-5061

SMALL CLASS C

None

SMALL CLASS Y

None

<PAGE>

INVESTMENT ADVISORY AND OTHER SERVICES

INVESTMENT ADVISER

The investment adviser to each Fund (the "Adviser") is a subsidiary of
First Union Corporation ("First Union"). First Union Corporation is a bank
holding company headquartered at 301 South College Street, Charlotte, North
Carolina 28288. First Union Corporation and its subsidiaries provide a broad
range of financial services to individuals and businesses throughout the United
States.

The Adviser to Evergreen and Micro is Evergreen Asset Management Corp.
("Evergreen Asset"), 2500 Westchester Avenue, Purchase, New York 10577.
Evergreen Asset is entitled to receive from each Fund an annual fee based on
each Fund's average daily net assets, as follows: 1.00% of the first $750
million; plus 0.90% of the next $250 million; plus 0.80% of assets over $1
billion. Under an agreement with Evergreen Asset, Lieber & Company, a First
Union subsidiary at the same address as Evergreen Asset, serves as subadviser to
each Fund at no additional cost to either Fund. Lieber & Company is paid for its
services by Evergreen Asset.

The Adviser to Aggressive is the Capital Management Group ("CMG") of First
Union National Bank ("FUNB"). CMG is entitled to receive from the Fund an annual
fee equal to 0.60% of the Fund's average daily net assets.

The Adviser to Omega, Small and Strategic is Keystone Investment Management
Company ("Keystone"), 200 Berkeley Street, Boston, Massachusetts 02116. Keystone
is entitled to receive from Omega an annual fee based on the aggregate net asset
value of the Fund's shares, as follows: 0.75% of the first $250 million; plus
0.675% of the next $250 million; plus 0.60% of the next $500 million; plus 0.50%
of assets over $1 billion, all computed as of the close of business each
business day and payable monthly. Keystone is entitled to receive from Small and
Strategic an annual fee based on the aggregate net asset value of each Fund's
shares, as follows: 0.70% of the first $100 million; plus 0.65% of the next $100
million; plus 0.60% of the next $100 million; plus 0.55% of the next $100
million; plus 0.50% of the next $100 million; plus 0.45% of the next $500
million; plus 0.40% of the next $500 million; plus 0.35% of assets over $1.5
billion, all computed as of the close of business each business day and payable
monthly.

INVESTMENT ADVISORY AGREEMENTS

On behalf of each if its Funds, the Trust has entered into an
investment advisory agreement with the Adviser (the "Advisory Agreements") .
Under the Advisory Agreements, and subject to the supervision of the Trust's
Board of Trustees, the Adviser furnishes to the appropriate Fund investment
advisory, management and administrative services, office facilities, and
equipment in connection with its services for managing the investment and
reinvestment of the Fund's assets. The Adviser pays for all of the expenses
incurred in connection with the provision of its services. Each Fund pays for
all charges and expenses, other than those specifically referred to as being
borne by the Adviser, including, but not limited to, (1) custodian charges and
expenses; (2) bookkeeping and auditors' charges and expenses; (3) transfer agent
charges and expenses; (4) fees and expenses of Independent Trustees; (5)
brokerage commissions, brokers' fees and expenses; (6) issue and transfer taxes;
(7) costs and expenses under the Distribution Plan (as applicable) (8) taxes and
trust fees payable to governmental agencies; (9) the cost of share certificates;
(10) fees and expenses of the registration and qualification of such Fund and
its shares with the Securities and Exchange Commission or under state or other
securities laws; (11) expenses of preparing, printing and mailing prospectuses,
SAIs, notices, reports and proxy

<PAGE>

materials to shareholders of each Fund; (12) expenses of shareholders' and
Trustees' meetings; (13) charges and expenses of legal counsel for each Fund and
for the Independent Trustees of the Trust on matters relating to such Fund; (14)
charges and expenses of filing annual and other reports with the Securities and
Exchange Commission ("SEC") and other authorities; and all extraordinary charges
and expenses of such Fund. (See also the section entitled "Financial
Information.")

Each Advisory Agreement continues in effect for two years from its
effective date and, thereafter, from year to year only if approved at least
annually by the Board of Trustees of the Trust or by a vote of a majority of
each Fund's outstanding shares. In either case, the terms of the Advisory
Agreement and continuance thereof must be approved by the vote of a majority of
the Independent Trustees (Trustees who are not interested persons of a Fund, as
defined in the 1940 Act) cast in person at a meeting called for the purpose of
voting on such approval. The Advisory Agreements may be terminated, without
penalty, on 60 days' written notice by the Trust's Board of Trustees or by a
vote of a majority of outstanding shares. Each Advisory Agreement will terminate
automatically upon its "assignment" as that term is defined in the 1940 Act.

Transactions Among Advisory Affiliates

The Trust has adopted procedures pursuant to Rule 17a-7 of the 1940 Act
("Rule 17a-7 Procedures"). The Rule 17a-7 Procedures permit a Fund to buy or
sell securities from another investment company for which a subsidiary of First
Union is an investment adviser. The Rule 17a-7 Procedures also allow the Funds
to buy or sell securities from other advisory clients for whom a subsidiary of
First Union is an investment adviser. The Funds may engage in such transaction
if they are equitable to each participant and consistent with each participant's
investment objective.

DISTRIBUTOR

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

DISTRIBUTION PLANS AND AGREEMENTS

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

Under the Rule 12b-1 Distribution Plans that have been adopted by each
Fund with respect to each of its Class A, Class B and Class C shares (each a
"Plan" and collectively, the "Plans"), the Treasurer of each Fund reports the
amounts expended under the Plans and the purposes for which such expenditures
were made to the Trustees of the Trust for their review on a quarterly basis.
Also, each Plan provides that the selection and nomination of the disinterested
Trustees are committed to the discretion of such disinterested Trustees then in
office.

<PAGE>

The Adviser may from time to time from its own funds or such other
resources as may be permitted by rules of the SEC make payments for distribution
services to the Distributor; the latter may in turn pay part or all of such
compensation to brokers or other persons for their distribution assistance.

Each Plan and Distribution Agreement will continue in effect for
successive twelve-month periods provided, however, that such continuance is
specifically approved at least annually by the Trustees of the Trust or by vote
of the holders of a majority of the outstanding voting securities of that class
and, in either case, by a majority of the Independent Trustees of the Trust who
have no direct or indirect financial interest in the operation of the Plan or
any agreement related thereto.

The Plans permit the payment of fees to brokers and others for
distribution and shareholder-related administrative services and to
broker-dealers, depository institutions, financial intermediaries and
administrators for administrative services as to Class A, Class B and Class C
shares. The Plans are designed to (i) stimulate brokers to provide distribution
and administrative support services to each Fund and holders of Class A, Class B
and Class C shares and (ii) stimulate administrators to render administrative
support services to the Fund and holders of Class A, Class B and Class C shares.
The administrative services are provided by a representative who has knowledge
of the shareholder's particular circumstances and goals, and include, but are
not limited to providing office space, equipment, telephone facilities, and
various personnel including clerical, supervisory, and computer, as necessary or
beneficial to establish and maintain shareholder accounts and records;
processing purchase and redemption transactions and automatic investments of
client account cash balances; answering routine client inquiries regarding Class
A, Class B and Class C shares; assisting clients in changing dividend options,
account designations, and addresses; and providing such other services as the
Fund reasonably requests for its Class A, Class B and Class C shares.

FUNB or its affiliates may finance the payments made by the Distributor
to compensate broker-dealers or other persons for distributing shares of a Fund.

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

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

<PAGE>

assignment. (See also the section entitled "Financial Information.")

ADDITIONAL SERVICE PROVIDERS

Administrator

Evergreen Investment Services, Inc. ("EIS") serves as administrator to
Aggressive, subject to the supervision and control of the Trust's Board of
Trustees. EIS provides the Fund with facilities, equipment and personnel and is
entitled to receive a fee from the Fund based on the total assets of all mutual
funds advised by First Union subsidiaries, as follows: 0.050% of the first $7
billion; 0.035% of the next $3 billion; 0.030% of the next $5 billion; 0.020% of
the next $10 billion; 0.015% of the next $5 billion and 0.010% of assets in
excess of $30 billion.

Transfer Agent

Evergreen Service Company ("ESC"), a subsidiary of First Union, is the
Funds' transfer agent. The transfer agent issues and redeems shares, pays
dividends and performs other duties in connection with the maintenance of
shareholder accounts. The transfer agent's address is Box 2121, Boston,
Massachusetts 02106-2121.

Independent Auditors

KPMG Peat Marwick LLP, 99 High Street, Boston, Massachusetts 02110,
audits the annual financial statements of Omega, Small and Strategic.

Price Waterhouse LLP, 1177 Avenue of the Americas, New York, New York,
10036, audits the annual financial statements of Evergreen, Micro and
Aggressive.

Custodian

State Street Bank and Trust Company is the Funds' custodian. The bank
keeps custody of each Fund's securities and cash and performs other related
duties. The custodian's address is 225 Franklin Street, Boston, Massachusetts
02110.

Legal Counsel

Sullivan & Worcester LLP provides legal advice to the Funds.
Its address is 1025 Connecticut Avenue, N.W., Washington, D.C. 20036.

BROKERAGE

Due to regulatory developments affecting the securities exchanges and
brokerage practices, the Board of Trustees may modify or eliminate any of the
following policies.

BROKERAGE COMMISSIONS

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

<PAGE>

underwriting commission or concession, and purchases from dealers serving as
market makers will include a dealer's mark-up or reflect a dealer's mark-down.
Where transactions are made in the over-the-counter market, each Fund will deal
with primary market makers unless more favorable prices are otherwise
obtainable.

Each Fund expects to buy and sell its fixed income securities directly
from the issuer or an underwriter or market maker for the securities. Generally,
each Fund will not pay brokerage commissions for such purchases. When a Fund
buys a security from an underwriter, the purchase price will usually include an
underwriting commission or concession. The purchase price for securities bought
from dealers serving as market makers will similarly include the dealer's mark
up or reflect a dealer's mark down. When a Fund executes transactions in the
over-the-counter market, it will deal with primary market makers unless more
favorable prices are otherwise obtainable.

SELECTION OF BROKERS

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

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

Under each Advisory Agreement, each Fund may pay higher brokerage
commissions to a broker providing it with research services, as defined in item
6, above. Pursuant to Section 28(e) of the Securities Exchange Act of 1934, this
practice is permitted if the commission is reasonable in relation to the
brokerage and research services provided. Research services provided by a broker
to an Adviser do not replace, but supplement, the services an Adviser is
required to deliver to a Fund under the Advisory Agreement. It is impracticable
for an Adviser to allocate the cost, value and specific application of such
research services among its clients because research services intended for one
client may indirectly benefit another.

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

Lieber & Company, an affiliate of Evergreen Asset and a member of the
New York and American Stock Exchanges, will to the extent practicable effect
substantially all of the portfolio transactions for Evergreen and Micro effected
on those exchanges.

SIMULTANEOUS TRANSACTIONS

Each Adviser makes investment decisions for each Fund independently of
decisions made for its other clients. When a security is suitable for the
investment objective of more than one client, it may be prudent for an Adviser
to engage in a simultaneous transaction, that is, buy or sell

<PAGE>

the same security for more than one client. Each Adviser strives for an
equitable result in such transactions by using an allocation formula. The high
volume involved in some simultaneous transactions can result in greater value to
the Funds, but the ideal price or trading volume may not always be achieved for
an individual Fund.

TRUST ORGANIZATION

FORM OF ORGANIZATION

Each Fund is a series of an open-end management investment company,
known as "Evergreen Equity Trust" (the "Trust"). The Trust was formed as a
Delaware business trust on September 17, 1997 (the "Declaration of Trust"). A
copy of the Declaration of Trust is on file as an exhibit to the Trust's
Registration Statement, of which this SAI is a part. This summary is qualified
in its entirety by reference to the Declaration of Trust.

DESCRIPTION OF SHARES

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

VOTING RIGHTS

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

After the initial meeting as described above, no further meetings of
shareholders for the purpose of electing Trustees will be held, unless required
by law, unless and until such time as less than a majority of the Trustees
holding office have been elected by shareholders, at which time, the Trustees
then in office will call a shareholders' meeting for the election of Trustees.

LIMITATION OF TRUSTEES' LIABILITY

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

<PAGE>

PURCHASE, REDEMPTION AND PRICING OF SHARES

HOW THE FUNDS OFFER SHARES TO THE PUBLIC

You may buy shares of a Fund through the Distributor, broker-dealers
that have entered into special agreements with the Distributor or certain other
financial institutions. Each Fund offers four classes of shares (except
Strategic, which offers three) that differ primarily with respect to sales
charges and distribution fees. Depending upon the class of shares, you will pay
an initial sales charge when you buy a Fund's shares, a contingent deferred
sales charge (a "CDSC") when you redeem a Fund's shares or no sales charges at
all.

Class A Shares

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

Class B Shares

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

REDEMPTION TIMING CDSC RATE

Month of purchase and the first twelve-month
period following the month of purchase..................5.00%
Second twelve-month period following the month of purchase.......4.00%
Third twelve-month period following the month of purchase........3.00%
Fourth twelve-month period following the month of purchase.......3.00%
Fifth twelve-month period following the month of purchase........2.00%
Sixth twelve-month period following the month of purchase........1.00%
Thereafter.......................................................0.00%

If you redeem shares purchased after January 1, 1995, but before
January 9, 1998, you will pay a CDSC according to the CDSC schedule in effect
during that period.

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

Class C Shares

Class C shares are available only through broker-dealers who have
entered into special

<PAGE>

distribution agreements with the Distributor. The Funds offer Class C shares at
net asset value without an initial sales charge. With certain exceptions,
however, the Funds will charge a CDSC of 1.00% on shares you redeem within
12-months after the month of your purchase. See "Contingent Deferred Sales
Charge" below.

Class Y Shares (Not Offered by Strategic)

No CDSC is imposed on the redemption of Class Y shares. Class Y shares
are not offered to the general public and are available only to (1) persons who
at or prior to December 31, 1994 owned shares in a mutual fund advised by
Evergreen Asset, (2) certain institutional investors and (3) investment advisory
clients of CMG, Evergreen Asset, Keystone, or their affiliates. Class Y shares
are offered at net asset value without a front-end or back-end sales charge and
do not bear any Rule 12b-1 distribution expenses.

CONTINGENT DEFERRED SALES CHARGE

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

SALES CHARGE WAIVERS OR REDUCTIONS

Reducing Class A Front-end Loads

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

Combined Purchases

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

Rights of Accumulation

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

<PAGE>

Letter of Intent

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

Waiver of Initial Sales Charges

The Funds may sell their shares at net asset value without an initial
sales charge to:

1. purchases of shares in the amount of $1 million or more;

2. a corporate or certain other qualified retirement plan or a
non-qualified deferred compensation plan or a Title 1 tax
sheltered annuity or TSA plan sponsored by an organization
having 100 or more eligible employees (a "Qualifying Plan") or
a TSA plan sponsored by a public educational entity having
5,000 or more eligible employees (an "Educational TSA Plan");

3. institutional investors, which may include bank trust
departments and registered investment advisers;

4. investment advisers, consultants or financial planners who
place trades for their own accounts or the accounts of their
clients and who charge such clients a management, consulting,
advisory or other fee;

5. clients of investment advisers or financial planners who place
trades for their own accounts if the accounts are linked to
master account of such investment advisers or financial
planners on the books of the broker-dealer through whom shares
are purchased;

6. institutional clients of broker-dealers, including retirement
and deferred compensation plans and the trusts used to fund
these plans, which place trades through an omnibus account
maintained with a Fund by the broker-dealer;

7. employees of FUNB, its affiliates, Evergreen Distributor,
Inc., any broker-dealer with whom Evergreen Distributor, Inc.,
has entered into an agreement to sell shares of the Funds, and
members of the immediate families of such employees;

8. certain Directors, Trustees, officers and employees of the
Evergreen funds, the Distributor or their affiliates and to
the immediate families of such persons; or

9. a bank or trust company in a single account in the name of
such bank or trust company as trustee if the initial
investment in or any Evergreen fund made pursuant to this
waiver is at least $500,000 and any commission paid at the
time of such purchase is not more than 1% of the amount
invested.

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

<PAGE>

Waiver of CDSCS

The Funds do not impose a CDSC when the shares you are redeeming
represent:

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

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

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

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

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

6. shares in an account that we have closed because the account
has an aggregate net asset value of less than $1,000;

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

8. a withdrawal consisting of loan proceeds to a retirement plan
participant;

9. financial hardship withdrawals made by a retirement plan
participant;

10. a withdrawal consisting of returns of excess contributions or
excess deferral amounts made to a retirement plan; or

11. a redemption by an individual participant in a Qualifying Plan
that purchased Class C shares (this waiver is not available in
the event a Qualifying Plan, as a whole, redeems substantially
all of its assets).

Merrill Lynch Plans

Class A and B shares are made available to employer-sponsored
retirement or savings plans ("Plans") without a sales charge if:

(i) the Plan is recordkept on a daily valuation basis by Merrill
Lynch and, on the date the Plan Sponsor signs the Merrill
Lynch Recordkeeping Service Agreement, the Plan has $3 million
or more in assets invested in broker/dealer funds not advised
or managed by Merrill Lynch Asset Management, L.P. ("MLAM")
that are made available pursuant to a Services Agreement
between Merrill Lynch and the Fund's principal underwriter or
distributor and in funds advised or managed by MLAM
(collectively, the "Applicable Investments"); or

(ii) the Plan is record kept on a daily valuation basis by an
independent recordkeeper whose services are provided through a
contract or alliance arrangement with Merrill Lynch, and on
the date the Plan Sponsor signs the Merrill Lynch
Recordkeeping

<PAGE>

Service Agreement, the Plan has $3 million or more in assets,
excluding money market funds, invested in Applicable
Investments; or

(iii) the Plan has 500 or more eligible employees, as determined by
the Merrill Lynch plan conversion manager, on the date the
Plan Sponsor signs the Merrill Lynch Recordkeeping Service
Agreement.

Plans recordkept on a daily basis by Merrill Lynch or an independent
recordkeeper under a contract with Merrill Lynch that are currently investing in
Class B shares convert to Class A shares once the Plan has reached $5 million
invested in Applicable Investments. The Plan will receive a Plan level share
conversion.

EXCHANGES

Investors may exchange shares of a Fund for shares of the same class of
any other Evergreen fund, as described under the section entitled "Exchanges" in
the prospectus. Before you make an exchange, you should read the prospectus of
the Evergreen fund into which you want to exchange. The Trust's Board of
Trustees reserves the right to discontinue, alter or limit the exchange
privilege at any time.

CALCULATION OF NET ASSET VALUE PER SHARE ("NAV")

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

The NAV of each class of shares of a Fund is calculated by dividing the
value of a Fund's net assets attributable to that class by the number of all
shares issued for that class.

VALUATION OF PORTFOLIO SECURITIES

Current values for a Fund's portfolio securities are determined as
follows:

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

(2) Securities traded on a national securities exchange or in the
over-the-counter market for which there has been no sale and other
securities traded in the over-the-counter market are valued at the mean
of the bid and asked prices at the time of valuation.

(3) Short-term investments maturing in more than sixty days, for which
market quotations are readily available, are valued at current market
value.

(4) Short-term investments maturing in sixty days or less are valued at
amortized cost, which approximates market.

(5) Securities, including restricted securities, for which market
quotations are not readily available; listed securities or those on NMS
if, in a Fund's opinion, the last sales price does

<PAGE>

not reflect a current market value; and other assets are valued at
prices deemed in good faith to be fair under procedures established by
the Board of Trustees.

SHAREHOLDER SERVICES

As described in the prospectus, a shareholder may elect to receive
their dividends and capital grains distributions in cash instead of shares.
However, ESC will automatically convert a shareholder's distribution option so
that the shareholder reinvests all dividends and distributions in additional
shares when it learns that the postal or other delivery service is unable to
deliver checks or transaction confirmations to the shareholder's address of
record. The Funds will hold the returned distribution or redemption proceeds in
a non interest-bearing account in the shareholder's name until the shareholder
updates their address. No interest will accrue on amounts represented by
uncashed distribution or redemption checks.

PRINCIPAL UNDERWRITER

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

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

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

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

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

The Underwriting Agreement may be terminated, without penalty, on 60
days' written notice by the Board of Trustees or by a vote of a majority of
outstanding shares subject to such

<PAGE>

agreement. The Underwriting Agreement will terminate automatically upon its
"assignment," as that term is defined in the 1940 Act.

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

ADDITIONAL TAX INFORMATION

REQUIREMENTS FOR QUALIFICATION AS A REGISTERED INVESTMENT COMPANY

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

TAXES ON DISTRIBUTIONS

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

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

From time to time, the Fund will distribute the excess of its net
long-term capital gains over its short-term capital loss to shareholders (i.e.,
capital gain dividends). For federal tax purposes, shareholders must include
such capital gain dividends when calculating their net

<PAGE>

long-term capital gains. Capital gain dividends are taxable as net long-term
capital gains to a shareholder, no matter how long the shareholder has held the
shares.

Distributions by a Fund reduce its NAV. A distribution that reduces the
Fund's NAV below a shareholder's cost basis is taxable as described above,
although from an investment standpoint, it is a return of capital. In
particular, if a shareholder buys Fund shares just before the Fund makes a
distribution, when the Fund makes the distribution the shareholder will receive
what is in effect a return of capital. Nevertheless, the shareholder may incur
taxes on the distribution. Therefore, shareholders should carefully consider the
tax consequences of buying Fund shares just before a distribution.

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

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

TAXES ON THE SALE OR EXCHANGE OF FUND SHARES

Upon a sale or exchange of Fund shares, a shareholder will realize a
taxable gain or loss depending on his or her basis in the shares. A shareholder
must treat such gains or losses as a capital gain or loss if the shareholder
held the shares as capital assets. Capital gain on assets held for more than
eighteen months is generally subject to a maximum federal income tax rate of 20%
for an individual. The maximum capital gains tax rate for capital assets held by
an individual for more than twelve months but not more than eighteen months is
generally 28%. Also, a shareholder must treat as long-term capital gains or
losses any capital gains or losses on Fund shares held for more than one year.
Generally, the Code will not allow a shareholder to realize a loss on shares he
or she has sold or exchanged and replaced within a sixty-one-day period
beginning thirty days before and ending thirty days after he or she sold or
exchanged the shares. The Code will not allow a shareholder to realize a loss on
the sale of Fund shares held by the shareholder for six months or less to the
extent the shareholder received exempt-interest dividends on such shares.
Moreover, the Code will treat a shareholder's loss on shares held for six months
or less as a long-term capital loss to the extent the shareholder received
capital gain dividends on such shares.

Shareholders who fail to furnish their taxpayer identification numbers
to a Fund and to certify as to its correctness and certain other shareholders
may be subject to a 31% federal income tax backup withholding requirement on
dividends, distributions of capital gains and redemption proceeds paid to them
by the Fund. If the withholding provisions are applicable, any such dividends or
capital gain distributions to these shareholders, whether taken in cash or

<PAGE>

reinvested in additional shares, and any redemption proceeds will be reduced by
the amounts required to be withheld. Investors may wish to consult their own tax
advisers about the applicability of the backup withholding provisions.

OTHER TAX CONSIDERATIONS

The foregoing discussion relates solely to U.S. federal income tax law
as applicable to U.S. persons (i.e., U.S. citizens and residents and U.S.
domestic corporations, partnerships, trusts and estates). It does not reflect
the special tax consequences to certain taxpayers (e.g., banks, insurance
companies, tax exempt organizations and foreign persons). Shareholders are
encouraged to consult their own tax advisers regarding specific questions
relating to federal, state and local tax consequences of investing in shares of
a Fund. Each shareholder who is not a U.S. person should consult his or her tax
adviser regarding the U.S. and foreign tax consequences of ownership of shares
of a Fund, including the possibility that such a shareholder may be subject to a
U.S. withholding tax at a rate of 30% (or at a lower rate under a tax treaty) on
amounts treated as income from U.S. sources under the Code.

FINANCIAL INFORMATION

EXPENSES

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

1997 FUND EXPENSES
<TABLE>
<CAPTION>
Total Underwriting
Advisory Class A Class B Class C Underwriting Commissions
FUND Fees 12b-1 Fees 12b-1 Fees 12b-1 Fees Commissions Retained
===================== ================ ================ ================= ================ =============== ================
<S> <C> <C> <C> <C> <C> <C>
Evergreen (1) $13,089,112 $299,430 $3,629,968 $72,777 $1,464,361 $129,417
Aggressive (1) $1,013,344 $251,302 $289,795 $19,048 $278,145 $21,472
Micro (1) $428,047 $3,314 $13,933 $400 $2,223 $300
Omega (2) $1,480,178 $153,219 $739,237 $120,064 $254,113 $19,806
Small (3a) $2,387,425 N/A $4,928,079* N/A $878,274 $22,796
Small (3b) $7,788,033 N/A $16,641,755* N/A $17,885,604 $13,187,854
Strategic (4) $3,205,753 N/A $1,790,675* N/A -- --
===================== ================ ================ ================= ================ =============== ================
</TABLE>

(1) Year ended 9/30/97
(2) Nine months ended 9/30/97
(3a) Four months ended 9/30/97
(3b) Year ended 5/31/97
(4) Eleven months ended 9/30/97
* Not multiple class during this period; amount reflects all 12b-1 fees.

<PAGE>

1996 FUND EXPENSES
<TABLE>
<CAPTION>
Total Underwriting
Advisory Class A Class B Class C Underwriting Commissions
FUND Fees 12b-1 Fees 12b-1 Fees 12b-1 Fees Commissions Retained
===================== ================ ================ ================= ================ =============== ================
<S> <C> <C> <C> <C> <C> <C>
Evergreen (1) $9,145,287 $149,922 $1,185,957 $10,292 $1,462,012 $157,233
Aggressive (1) $612,492 $197,507 $26,469 $3,308 $185,835 $22,742
Micro (1) $510,421 $2,471 $12,608 $310 $2,963 $188
Omega (2) $1,831,142 $186,596 $814,977 $168,748 $983,621 $759,394
- --------------------- --------------- ----------------
Small (3) $8,473,139 N/A $18,458,861* N/A $15,690,812 ($5,933,719)
Strategic (4) $2,994,500 N/A $4,845,352* N/A $4,093,912 $2,049,519
===================== ================ ================ ================= ================ =============== ================
</TABLE>

(1) Year ended 9/30/96
(2) Year ended 12/31/96
(3) Year ended 5/31/96
(4) Year ended 10/31/96
* Not multiple class during this period; amount reflects all 12b-1 fees.

1995 FUND EXPENSES
Total Underwriting
Underwriting Commissions
FUND Advisory Fees Commissions Retained
==================== ================ ================ ================
Evergreen (1) $5,472,439 $586,701 $72,923
Aggressive (2) $106,041 $70,327 $89,909
Micro (1) $800,642 $3,418 $495
Omega (3) $1,280,436 $548,386 $1,167,486
- --------------------
Small (4) $6,037,504 $10,076,379 $2,257,795
Strategic (5) $2,799,544 $3,911,744 $288,671

(1) Nine months ended 9/30/95
(2) Two months ended 9/30/95
(3) Year ended 12/31/95
(4) Year ended 5/31/95
(5) Year ended 10/31/95

BROKERAGE COMMISSIONS PAID

The table below shows (1) total amounts paid by each Fund in brokerage
commissions and (2) amounts paid to Lieber and Company, an affiliate of FUNB,
during each of the last three years.

<PAGE>

<TABLE>
<CAPTION>
Evergreen Aggressive Micro Omega Small Strategic
====================== =================== ================ ============== ============== =============== ==============
<S> <C> <C> <C> <C> <C> <C>
1997 Aggregate $ 503,276 $677,860 $ 91,568 $403,294 $1,891,397 $1,144,065
Dollar Amount
1997 Dollar Amount $ 416,953 -- $ 61,717 -- -- --
Paid to Lieber
1996 Aggregate $590,105 -- $ 317,058 $829,479 $2,853,950 $1,990,208
Dollar Amount
1996 Dollar Amount $515,522 -- $153,596 -- -- --
Paid to Lieber
1995 Aggregate $342,559 -- $414,048 $735,203 $1,445,066 $871,000
Dollar Amount
- ----------------------
1995 Dollar Amount $252,069 -- $125,347 -- -- --
Paid to Lieber
====================== =================== ================ ============== ============== =============== ==============
</TABLE>

COMPUTATION OF CLASS A OFFERING PRICE

Class A shares are sold at the NAV plus a sales charge. Below
is an example of the method of computing the offering price of Class A shares of
each Fund. The example assumes a purchase of Class A shares of each Fund
aggregating less than $100,000 based upon the NAV of each Fund's Class A shares
at the end of each Fund's latest fiscal period.

<TABLE>
<CAPTION>
FUND* DATE NET ASSET VALUE PER SHARE SALES OFFERING PRICE PER
CHARGE SHARE
<S> <C> <C> <C> <C>
Evergreen 9/30/97 $22.96 4.75% $24.10
Aggressive 9/30/97 $23.48 4.75% $24.65
Micro 9/30/97 $26.68 4.75% $28.01
Omega Fund 9/30/97 $22.69 4.75% $23.82
========================= ================ =============== ================= =================
</TABLE>

*Excludes Strategic and Small, which did not offer Class A at the end of their
latest fiscal periods.

PERFORMANCE

Total Return

Total return quotations for a class of shares of a Fund as they may
appear from time to time in advertisements are calculated by finding the average
annual compounded rates of return over one, five and ten year periods, or the
time periods for which such class of shares has been effective, whichever is
relevant, on a hypothetical $1,000 investment that would equate the initial
amount invested in the class to the ending redeemable value. To the initial
investment all dividends and distributions are added, and all recurring fees
charged to all shareholder accounts are deducted. The ending redeemable value
assumes a complete redemption at the end of the relevant periods.

<PAGE>

The annual total returns for each class of shares of the Funds (including
applicable sales charges) are as follows:

TEN YEARS OR
ONE YEAR FIVE YEARS SINCE INCEPTION INCEPTION DATE
EVERGREEN
Class A 27.37% -- 27.63% Jan. 3, 1995
Class B 27.69% -- 28.32% Jan. 3, 1995
Class C 31.67% -- 29.01% Jan. 3, 1995
EVERGREEN
Class Y 34.08% 19.88% 12.64% Oct. 15, 1971
AGGRESSIVE
Class A 6.30% 16.77% 14.73% Apr. 15, 1983
Class B 5.96% -- 19.49% July 7, 1995
Class C 9.92% -- 19.22% Aug. 3, 1995
Class Y 11.76% -- 21.67% July 11, 1995
MICRO
Class A 46.81% -- 20.43% Jan. 3, 1995
Class B 48.13% -- 20.91% Jan. 3, 1995
Class C 52.07% -- 21.72% Jan. 3, 1995
Class Y 54.64% 14.19% 11.46% June 1, 1983
OMEGA
Class A 20.60% 16.86% 14.31% Apr. 29, 1968
Class B 20.45% -- 15.45% Aug. 2, 1993
Class C 24.41% -- 15.78% Aug. 2, 1993
Class Y -- -- -- Jan. 13, 1997
STRATEGIC
Class B 37.33% 18.73% 11.76% Jul. 15, 1935
SMALL 11.06% 15.63% 11.91% Jul. 15, 1935
Class B
============== ================ ============ ================= ===============

Non-Standardized Performance

In addition to the performance information described above, a Fund may
provide total return information for designated periods, such as for the most
recent six months or most recent twelve months. This total return information is
computed as described under "Total Return" above except that no annualization is
made.

<PAGE>

General

From time to time, a Fund may quote its performance in advertising and
other types of literature as compared to the performance of the Standard &
Poor's 500 Composite Stock Price Index, the Dow Jones Industrial Average,
Russell 2000 Index, or any other commonly quoted index of common stock prices.
The Standard & Poor's 500 Composite Stock Price Index, the Dow Jones Industrial
Average and the Russell 2000 Index are unmanaged indices of selected common
stock prices. A Fund's performance may also be compared to those of other mutual
funds having similar objectives. This comparative performance would be expressed
as a ranking prepared by Lipper Analytical Services, Inc. or similar independent
services monitoring mutual fund performance. A Fund's performance will be
calculated by assuming, to the extent applicable, reinvestment of all capital
gains distributions and income dividends paid. Any such comparisons may be
useful to investors who wish to compare a Fund's past performance with that of
its competitors. Of course, past performance cannot be a guarantee of future
results.

Financial Statements

The audited financial statements and the reports thereon are hereby
incorporated by reference to each Fund's Annual Report, a copy of which may be
obtained without charge from ESC, P.O. Box 2121, Boston, Massachusetts
02106-2121.

ADDITIONAL INFORMATION

Except as otherwise stated in its prospectus or required by law, each
Fund reserves the right to change the terms of the offer stated in its
prospectus without shareholder approval, including the right to impose or change
fees for services provided.

No dealer, salesman or other person is authorized to give any
information or to make any representation not contained in a Fund's prospectus,
SAI or in supplemental sales literature issued by such Fund or the Distributor,
and no person is entitled to rely on any information or representation not
contained therein.

Each Fund's prospectus and SAI omit certain information contained in
the Trust's registration statement, which you may obtain for a fee from the SEC
in Washington, D.C.

22987
35

<PAGE>

APPENDIX A

S&P AND MOODY'S BOND RATINGS

S&P Bond Ratings

An S&P bond rating is a current assessment of the creditworthiness of an
obligor, including obligors outside the U.S., with respect to a specific
obligation. This assessment may take into consideration obligors such as
guarantors, insurers or lessees. Ratings of foreign obligors do not take into
account currency exchange and related uncertainties. The ratings are based on
current information furnished by the issuer or obtained by S&P from other
sources it considers reliable.

The ratings are based, in varying degrees, on the following
considerations:

a. Likelihood of default and capacity and willingness of the obligor as
to the timely payment of interest and repayment of principal in accordance with
the terms of the obligation;

b. Nature of and provisions of the obligation; and

c. Protection afforded by and relative position of the obligation in
the event of bankruptcy reorganization or other arrangement under the laws of
bankruptcy and other laws affecting creditors' rights.

PLUS (+) OR MINUS (-): To provide more detailed indications of credit
quality, ratings from "AA" to "BBB" may be modified by the addition of a plus or
minus sign to show relative standing within the major rating categories.

A provisional rating is sometimes used by S&P. It assumes the
successful completion of the project being financed by the debt being rated and
indicates that payment of debt service requirements is largely or entirely
dependent upon the successful and timely completion of the project. This rating,
however, while addressing credit quality subsequent to completion of the
project, makes no comment on the likelihood of, or the risk of default upon
failure of, such completion.

S&P bond ratings are as follows:

a. AAA - Debt rated AAA has the highest rating assigned by S&P.
Capacity to pay interest and repay principal is extremely strong.

b. AA - Debt rated AA has a very strong capacity to pay interest and
repay principal and differs from the higher rated issues only in small degree.

3. A - Debt rated A has a strong capacity to pay interest and repay
principal although it is somewhat more susceptible to the adverse effects of
changes in circumstances and economic conditions than debt in higher rated
categories.

4. BBB - Debt rated BBB is regarded as having an adequate capacity to
pay interest and

22987
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<PAGE>

repay principal. Whereas it normally exhibits adequate protection parameters,
adverse economic conditions or changing circumstances are more likely to lead to
a weakened capacity to pay interest and repay principal for debt in this
category than in higher rated categories.

5. BB, B, CCC, CC and C - Debt rated BB, B, CCC, CC and C is regarded,
on balance, as predominantly speculative with respect to capacity to pay
interest and repay principal in accordance with the terms of the obligation. BB
indicates the lowest degree of speculation and C the highest degree of
speculation. While such debt will likely have some quality and protective
characteristics, these are outweighed by large uncertainties or major risk
exposures to adverse conditions.

Moody's Bond Ratings

Moody's ratings are as follows:

1. Aaa - Bonds which are rated Aaa are judged to be of the best
quality. They carry the smallest degree of investment risk and are generally
referred to as "gilt-edge." Interest payments are protected by a large or by an
exceptionally stable margin and principal is secure. While the various
protective elements are likely to change, such changes as can be visualized are
most unlikely to impair the fundamentally strong position of such issues.

2. Aa - Bonds which are rated Aa are judged to be of high quality by
all standards. Together with the Aaa group they comprise what are generally
known as high grade bonds. They are rated lower than the best bonds because
margins of protection may not be as large as in Aaa securities or fluctuation of
protective elements may be of greater amplitude or there may be other elements
present which make the long term risks appear somewhat larger than in Aaa
securities.

3. A - Bonds which are rated A possess many favorable investment
attributes and are to be considered as upper medium grade obligations. Factors
giving security to principal and interest are considered adequate but elements
may be present which suggest a susceptibility to impairment sometime in the
future.

4. Baa - Bonds which are rated Baa are considered as medium grade
obligations, i.e., they are neither highly protected nor poorly secured.
Interest payments and principal security appear adequate for the present but
certain protective elements may be lacking or may be characteristically
unreliable over any great length of time. Such bonds lack outstanding investment
characteristics and in fact have speculative characteristics as well.

5. Ba - Bonds which are rated Ba are judged to have speculative
elements. Their future cannot be considered as well assured. Often the
protection of interest and principal payments may be very moderate and thereby
not well safeguarded during both good and bad times over the future. Uncertainty
of position characterizes bonds in this class.

6. B - Bonds which are rated B generally lack characteristics of the
desirable investment. Assurance of interest and principal payments or of
maintenance of other terms of the contract over any long period of time may be
small.

7. Caa - Bonds which are rated Caa are of poor standing. Such issues
may be in default or there may be present elements of danger with respect to
principal or interest.

22987
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<PAGE>

8. Ca - Bonds which are rated Ca represent obligations which are
speculative in a high degree. Such issues are often in defauolt or have other
market shortcomings.

9. C - Bonds which are rated as C are the lowest rated class of bonds
and issues so rated can be regarded as having extremely poor prospects of ever
attaining any real investment standing.

Moody's applies numerical modifiers, 1, 2 and 3 in each generic rating
classification from Aa through Baa in its corporate bond rating system. The
modifier 1 indicates that the security ranks in the higher end of its generic
rating category; the modifier 2 indicates a mid-range ranking; and the modifier
3 indicates that the issue ranks in the lower end of its generic rating
category.

MONEY MARKET INSTRUMENTS

Money market securities are instruments with remaining maturities of
one year or less such as bank certificates of deposit, bankers' acceptances,
commercial paper (including variable rate master demand notes), and obligations
issued or guaranteed by the U.S. government, its agencies or instrumentalities,
some of which may be subject to repurchase agreements.

Commercial Paper

Commercial paper will consist of issues rated at the time of purchase
A-1, by S&P, or Prime-1 by Moody's or F-1 by Fitch; or, if not rated, will be
issued by companies which have an outstanding debt issue rated at the time of
purchase Aaa, Aa or A by Moody's, or AAA, AA or A by S&P or Fitch, or will be
determined by a Fund's investment adviser to be of comparable quality.

A. S&P Ratings

An S&P commercial paper rating is a current assessment of the
likelihood of timely payment of debt having an original maturity of no more than
365 days. Ratings are graded into four categories, ranging from "A" for the
highest quality obligations to "D" for the lowest.
The top category is as follows:

1. A: Issues assigned this highest rating are regarded as having the
greatest capacity for timely payment. Issues in this category are delineated
with the numbers 1, 2 and 3 to indicate the relative degree of safety.

2. A-1: This designation indicates that the degree of safety regarding
timely payment is either overwhelming or very strong. Those issues determined to
possess overwhelming safety characteristics are denoted with a plus (+) sign
designation.

B. Moody's Ratings

The term "commercial paper" as used by Moody's means promissory
obligations not having an original maturity in excess of nine months. Moody's
commercial paper ratings are opinions of the ability of issuers to repay
punctually promissory obligations not having an original maturity in excess of
nine months. Moody's employs the following designation, judged to be investment
grade, to indicate the relative repayment capacity of rated issuers.

1. The rating Prime-1 is the highest commercial paper rating assigned
by Moody's. Issuers rated Prime-1 (or related supporting institutions) are
deemed to have a superior capacity for

22987
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<PAGE>

repayment of short term promissory obligations. Repayment capacity of Prime-1
issuers is normally evidenced by the following characteristics:

1) leading market positions in well-established industries;

2) high rates of return on funds employed;

3) conservative capitalization structures with moderate reliance
on debt and ample asset protection;

4) broad margins in earnings coverage of fixed financial charges
and high internal cash generation; and

5) well established access to a range of financial markets and
assured sources of alternate liquidity.

In assigning ratings to issuers whose commercial paper obligations are
supported by the credit of another entity or entities, Moody's evaluates the
financial strength of the affiliated corporations, commercial banks, insurance
companies, foreign governments or other entities, but only as one factor in the
total rating assessment.

22987
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<PAGE>

EVERGREEN EQUITY TRUST

PART C

OTHER INFORMATION

Item 24. Financial Statements and Exhibits

Item 24(a). Financial Statements

The financial statements listed below are included in Part A of this
Amendment to the Registration Statement:

Financial Highlights for:
<TABLE>
<S> <C>
EVERGREEN FUND - Class A For each of the years in the two-year period ended September 30, 1997; and for the period
from January 3, 1995 (Commencement of Operations) to September 30, 1995.

EVERGREEN FUND - Class B For each of the years in the two-year period ended September 30, 1997; and for the period
from January 3, 1995 (Commencement of Operations) to September 30, 1995.

EVERGREEN FUND - Class C For each of the years in the two-year period ended September 30, 1997; and for the period
from January 3, 1995 (Commencement of Operations) to September 30, 1995.

EVERGREEN FUND - Class Y For each of the years in the ten-year period ended September 30, 1997.

EVERGREEN AGGRESSIVE GROWTH FUND - For each of the years in the two-year period ended September 30, 1997; for the eleven-month
Class A period ended September 30, 1995; for each of the years in the six-year period ended
October 31, 1994; for the ten-month period ended October 31, 1988; and for the one-year
ended December 31, 1987.

EVERGREEN AGGRESSIVE GROWTH FUND - For each of the years in the two-year period ended September 30, 1997; and for the period
Class B from July 7, 1995 (Commencement of Operations) to September 30, 1995.

EVERGREEN AGGRESSIVE GROWTH FUND - For each of the years in the two-year period ended September 30, 1997; and for the period
Class C from August 3, 1995 (Commencement of Operations) to September 30, 1995.

EVERGREEN AGGRESSIVE GROWTH FUND - For each of the years in the two-year period ended September 30, 1997; and for the period
Class Y from July 11, 1995 (Commencement of Operations) to September 30, 1995.

EVERGREEN MICRO CAP FUND - Class A For each of the years in the two-year period ended September 30, 1997; and for the period
from January 3, 1995 (Commencement of Operations) to September 30, 1995.

EVERGREEN MICRO CAP FUND - Class B For each of the years in the two-year period ended September 30, 1997; and for the period
from January 3, 1995 (Commencement of Operations) to September 30, 1995.

EVERGREEN MICRO CAP FUND - Class C For each of the years in the two-year period ended September 30, 1997; and for the period
from January 3, 1995 (Commencement of Operations) to September 30, 1995.

EVERGREEN MICRO CAP FUND - Class Y For each of the years in the three-year period ended September 30, 1997; for the four-month
period ended September 30, 1994; and for each of the years in the seven-year period ended
May 31, 1994.

EVERGREEN OMEGA FUND - Class A For the nine-month period ended September 30, 1997; and for each of the years in the
ten-year period ended December 31, 1996.

EVERGREEN OMEGA FUND - Class B For the nine-month period ended September 30, 1997; for each of the years in the three-year
period ended December 31, 1996; and for the period from August 2, 1993 (Commencement of
Operations) to December 31, 1993.

EVERGREEN OMEGA FUND - Class C For the nine-month period ended September 30, 1997; for each of the years in the three-year
period ended December 31, 1996; and for the period from August 2, 1993 (Commencement of
Operations) to December 31, 1993.

EVERGREEN OMEGA FUND - Class Y For the period from January 13, 1997 (Commencement of Operations) to September 30, 1997.

EVERGREEN SMALL COMPANY GROWTH For the four-month period ended Septemebr 30, 1997 and for each of the years in the
FUND ten-year period ended May 31, 1997.

EVERGREEN STRATEGIC GROWTH FUND For the eleven-month period ended September 30, 1997 and for each of the years in the
ten-year period ended October 31, 1996.
</TABLE>

The financial statements listed below are incorporated by reference
in Part B of this Amendment to the Registration Statement:

Schedule of Investments of Evergreen Aggressive Growth Fund, Evergreen
Fund, Evergreen Micro Cap Fund, Inc., Evergreen Omega Fund, Evergreen
Small Company Growth Fund, Evergreen Strategic Growth Fund as of
September 30, 1997.

Statement of Assets and Liabilities of Evergreen Aggressive Growth
Fund, Evergreen Fund, Evergreen Micro Cap Fund, Inc., Evergreen
Omega Fund, Evergreen Small Company Growth Fund, Evergreen Strategic
Growth Fund as of September 30, 1997.

Statement of Operations of Evergreen Aggressive Growth Fund, Evergreen
Fund, Evergreen Micro Cap Fund, Inc., Evergreen Omega Fund, Evergreen
Small Company Growth Fund, Evergreen Strategic Growth Fund as of
September 30, 1997.

Statement of Changes in Net Assets of Evergreen Aggressive Growth
Fund, Evergreen Fund, Evergreen Micro Cap Fund, Inc., Evergreen
Omega Fund, Evergreen Small Company Growth Fund, Evergreen Strategic
Growth Fund as of September 30, 1997.

Notes to Financial Statements of Evergreen Aggressive Growth Fund,
Evergreen Fund, Evergreen Micro Cap Fund, Inc., Evergreen Omega Fund,
Evergreen Small Company Growth Fund, Evergreen Strategic Growth Fund.

Report of Independent Accountants for Evergreen Aggressive Growth
Fund, Evergreen Fund, and Evergreen Micro Cap Fund, Inc. as of
November 11, 1996.

Independent Auditors' Report for Evergreen Omega Fund as of
October 31, 1997.

Independent Auditors' Report for Evergreen Strategic Growth Fund as of
October 31, 1997.

Independent Auditors' Report for Evergreen Small Company Growth Fund
as of October 31, 1997.

The information required by this item for Evergreen American Retirement
Fund, Evergreen Foundation Fund, Evergreen Tax Strategic Foundation Fund,
Evergreen Fund for Total Return, Evergreen Growth and Income Fund, Evergreen
Income and Growth Fund, Evergreen Small Cap Equity Income Fund, Evergreen Value
Fund, Evergreen Utility Fund, and Evergreen Blue Chip Fund is contained in
Registration Statement No. 333-42195/811-08553 filed on December 12, 1997.

The information required by this item for Evergreen Balanced Fund is
contained in Registration Statement No. 333-42195/811-08553 filed on November
10, 1997.

Item 24(b). Exhibits

<TABLE>
<CAPTION>
Exhibit
Number Description Location
- ------- ----------- -----------
<S> <C> <C>
1 Declaration of Trust Incorporated by reference to
Registrant's Registration Statement
Filed on October 8, 1997

2 By-laws Incorporated by reference to
Registrant's Registration Statement
Filed on October 8, 1997

3 Not applicable

4 Provisions of instruments defining the rights
of holders of the securities being registered
are contained in the Declaration of Trust
Articles II, III.(6)(c), VI.(3), IV.(8), V, VI,
VII, VIII and By-laws Articles II, III and VIII
included as part of Exhibits 1 and 2 of this
Registration Statement

5(a) Form of Investment Advisory and Management Incorporated by reference to
Agreement between the Registrant and First Registrant's Post-Effective Amendment No. 2
Union National Bank Filed on December 12, 1997

5(b) Form of Investment Advisory and Management Incorporated by reference to
Agreement between the Registrant and Evergreen Registrant's Post-Effective Amendment No. 2
Asset Management Corp. Filed on December 12, 1997

5(c) Form of Investment Advisory and Management Incorporated by reference to
Agreement between the Registrant and Keystone Registrant's Post-Effective Amendment No. 2
Investment Management Company Filed on December 12, 1997

6(a) Form of Class A and Class C Principal Underwriting Incorporated by reference to
Agreement between the Registrant and Evergreen Registrant's Pre-Effective Amendment No. 1
Distributor, Inc. Filed on November 10, 1997

6(b) Form of Class B Principal Underwriting Agreement Incorporated by reference to
between the Registrant and Evergreen Investment Registrant's Pre-Effective Amendment No. 1
Services, Inc. (B-1) Filed on November 10, 1997

6(c) Form of Class B Principal Underwriting Agreement Incorporated by reference to
between the Registrant and Evergreen Distributor, Registrant's Pre-Effective Amendment No. 1
Inc. (B-2) Filed on November 10, 1997

6(d) Form of Class B Principal Underwriting Agreement Incorporated by reference to
between the Registrant and Evergreen Distributor, Registrant's Post-Effective Amendment No. 2
Inc. (Evergreen/KCF) Filed on December 12, 1997

6(e) Form of Class Y Principal Underwriting Agreement Incorporated by reference to
between the Registrant and Evergreen Distributor, Registrant's Pre-Effective Amendment No. 1
Inc. Filed on November 10, 1997

6(f) Form of Principal Underwriting Agreement between Incorporated by reference to
the Registrant and Kokusai Securities Company Registrant's Pre-Effective Amendment No. 1
Limited Filed on November 10, 1997

6(g) Form of Dealer Agreement used by Evergreen Incorporated by reference to
Distributor, Inc. Registrant's Pre-Effective Amendment No. 1
Filed on November 10, 1997

7 Form of Deferred Compensation Plan Incorporated by reference to
Registrant's Pre-Effective Amendment No. 1
Filed on November 10, 1997

8 Form of Custodian Agreement between the Registrant Incoporated by reference to
and State Street Bank and Trust Company Registrant's Pre-Effective Amendment No. 1
Filed on November 10, 1997

9(a) Form of Administration Agreement between Evergreen Incoporated by reference to
Investment Services, Inc. and the Registrant Registrant's Post-Effective Amendment No. 2
Filed on December 12, 1997

9(b) Form of Transfer Agent Agreement between the Incoporated by reference to
Registrant and Evergreen Service Company Registrant's Pre-Effective Amendment No. 1
Filed on November 10, 1997

10 Opinion and Consent of Sullivan & Worcester LLP Incoporated by reference to
Registrant's Post-Effective Amendment No. 2
Filed on December 12, 1997
11(a) Consent of Price Waterhouse LLP

11(b) Consent of KPMG Peat Marwick LLP

12 Not applicable

13 Not applicable

15(a) Form of 12b-1 Distribution Plan for Class A Incoporated by reference to
Registrant's Pre-Effective Amendment No. 1
Filed on November 10, 1997

15(b) Form of 12b-1 Distribution Plan for Class B Incoporated by reference to
(KAF B-1) Registrant's Pre-Effective Amendment No. 1
Filed on November 10, 1997

15(c) Form of 12b-1 Distribution Plan for Class B Incoporated by reference to
(KAF B-2) Registrant's Pre-Effective Amendment No. 1
Filed on November 10, 1997

15(d) Form of 12b-1 Distribution Plan for Class B Incoporated by reference to
(KCF/Evergreen) Registrant's Post-Effective Amendment No. 2
Filed on December 12, 1997

15(d) Form of 12b-1 Distribution Plan for Class C Incoporated by reference to
Registrant's Pre-Effective Amendment No. 1
Filed on November 10, 1997

16 Not applicable

17 Not applicable

18 Multiple Class Plan Incoporated by reference to
Registrant's Pre-Effective Amendment No. 1
Filed on November 10, 1997

19 Powers of Attorney Incoporated by reference to
Registrant's Pre-Effective Amendment No. 1
Filed on November 10, 1997

</TABLE>

Item 25. Persons Controlled by or Under Common Control with Registrant.

None

Item 26. Number of Holders of Securities (as of December 31, 1997)

NUMBER OF
TITLE OF CLASS RECORD HOLDERS
-------------- --------------
Evergreen Agressive Growth Fund
Class A 11,338
Class B 4,706
Class C 273
Class Y 564

Evergreen Fund
Class A 22,193
Class B 62,304
Class C 791
Class Y 2

Evergreen Micro Cap Fund
Class A 259
Class B 250
Class C 152
Class Y 974

Evergreen Omega Fund
Class A 9,997
Class B 8,204
Class C 1,269
Class Y 2

Evergreen Small Company Growth Fund
Class A 0
Class B 0
Class C 0
Class Y 0

Evergreen Strategic Growth Fund
Class A 0
Class B 43,823
Class C 0

Item 27. Indemnification.

Provisions for the indemnification of the Registrant's Trustees and
officers are contained the Registrant's Declaration of Trust.

Provisions for the indemnification of the Registrant's Investment Advisors
are contained in their respective Investment Advisory and Management Agreements.

Provisions for the indemnification of Evergreen Distributor, Inc., the
Registrant's principal underwriter, are contained in each Principal Underwriting
Agreement between Evergreen Distributor, Inc. and the Registrant.

Item 28. Business or Other Connections of Investment Adviser.

The Directors and principal executive officers of First Union National Bank
are:

Edward E. Crutchfield, Jr. Chairman and Chief Executive Officer,
First Union Corporation; Chief Executive
Officer and Chairman, First Union National
Bank

Anthony P. Terracciano President, First Union Corporation; President
First Union National Bank

John R. Georgius Vice Chairman, First Union Corporation;
Vice Chairman, First Union National Bank

Marion A. Cowell, Jr. Executive Vice President, Secretary &
General Counsel, First Union Corporation;
Secretary and Executive Vice President,
First Union National Bank

Robert T. Atwood Executive Vice President and Chief Financial
Officer, First Union Corporation; Chief
Financial Officer and Executive Vice
President

All of the above persons are located at the following address: First Union
National Bank, One First Union Center, Charlotte, NC 28288.

The information required by this item with respect to Evergreen Asset
Management Corp. is incorporated by reference to the Form ADV (File No.
801-46522) of Evergreen Asset Management Corp.

The information required by this item with respect to Keystone Investment
Management Company is incorporated by reference to the Form ADV (File No.
801-8327) of Keystone Investment Management Company.

Item 29. Principal Underwriters.

The Directors and principal executive officers of Evergreen Distributor,
Inc. are:

Lynn C. Mangum Director, Chairman and Chief Executive
Officer

Robert J. McMullan Director, Executive Vice President and
Treasurer

J. David Huber President

Kevin J. Dell Vice President, General Counsel and Secretary

All of the above persons are located at the following address: Evergreen
Distributor, Inc., 125 West 55th Street, New York, New York 10019.

Evergreen Distributor, Inc. acts as principal underwriter for each
registered investment company or series thereof that is a part of the Evergreen
Keystone "fund complex" as such term is defined in Item 22(a) of Schedule 14A
under the Securities Exchange Act of 1934.

Item 30. Location of Accounts and Records.

All accounts and records required to be maintained by Section 31(a) of the
Investment Company Act of 1940 and the Rules 31a-1 through 31a-3 promulgated
thereunder are maintained at one of the following locations:

Evergreen Investment Services, Inc., Evergreen Service Company and Keystone
Investment Management Company, all located at 200 Berkeley Street, Boston,
Massachusetts 02110

First Union National Bank, One First Union Center, 301 S. College Street,
Charlotte, North Carolina 28288

Evergreen Asset Management Corp., 2500 Westchester Avenue, Purchase,
New York 10577

Iron Mountain, 3431 Sharp Slot Road, Swansea, Massachusetts 02777

State Street Bank and Trust Company, 2 Heritage Drive, North Quincy,
Massachusetts 02171

Item 31. Management Services.

Not Applicable

Item 32. Undertakings.

The Registrant hereby undertakes to furnish each person to whom a
prospectus is delivered with a copy of the Registrant's latest annual
report to shareholders, upon request and without charge.

<PAGE>
SIGNATURES

Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940 the Registrant has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereto duly
authorized, in the City of Columbus, and State of Ohio, on the 30th day of
January, 1998.

EVERGREEN EQUITY TRUST

By: /s/ William J. Tomko
-----------------------------
Name: William J. Tomko
Title: President

Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities indicated on the 30th day of January, 1998.
<TABLE>
<CAPTION>
<S> <C> <C>
/s/William J. Tomko /s/ Laurence B. Ashkin /s/ Charles A. Austin, III
- ------------------------- ----------------------------- --------------------------------
William J. Tomko Laurence B. Ashkin* Charles A. Austin III*
President amd Treasurer (Principal Trustee Trustee
Financial and Accounting Officer)

/s/ K. Dun Gifford /s/ James S. Howell /s/ William Walt Pettit
- ---------------------------- ---------------------------- --------------------------------
K. Dun Gifford* James S. Howell* William Walt Pettit*
Trustee Trustee Trustee

/s/Gerald M. McDonnell /s/ Thomas L. McVerry /s/ Michael S. Scofield
- ------------------------------- ----------------------------- --------------------------------
Gerald M. McDonell* Thomas L. McVerry* Michael S. Scofield*
Trustee Trustee Trustee

/s/ David M. Richardson /s/ Russell A. Salton, III MD
- ------------------------------ -------------------------------
David M. Richardson* Russell A. Salton, III MD*
Trustee Trustee

/s/ Richard J. Shima
- ------------------------------
Richard J. Shima*
Trustee
</TABLE>

*By: /s/ Martin J. Wolin
- -------------------------------
Martin J. Wolin
Attorney-in-Fact

*Martin J. Wolin, by signing his name hereto, does hereby sign this
document on behalf of each of the above-named individuals pursuant to powers of
attorney duly executed by such persons.

<PAGE>
INDEX TO EXHIBITS

Exhibit
Number Exhibit
- ------- -------
11(a) Consent of Price Waterhouse LLP
11(b) Consent of KPMG Peat Marwick LLP

CONSENT OF INDEPENDENT ACCOUNTANTS

We hereby consent to the incorporation by reference in the Prospectuses and
Statement of Additional Information constituting parts of this Post-Effective
Amendment No. 3 to the registration statement on Form N-1A (the "Registration
Statement") of our report dated November 11, 1997, relating to the financial
statements and financial highlights appearing in the September 30, 1997 Annual
Report to Shareholders of Evergreeen Fund, Evergreen Aggressive Growth Fund
and Evergreen Micro Cap Fund, Inc., which is also incorporated by reference into
the Registration Statement. We also consent to the references to us under the
heading "Financial Highlights" in such Prospectuses and under the heading
"Independent Auditors" in such Statement of Additional Information.

Price Waterhouse LLP
1177 Avenue of the Americas
New York, New York 10036
January 27, 1998

CONSENT OF INDEPENDENT AUDITORS

The Trustees and Shareholders
Evergreen Equity Trust

We consent to:

* the use of our report dated October 31, 1997 for Evergreen Omega Fund
(formerly Keystone Omega Fund) incorporated by reference herein;

* the use of our report dated October 31, 1997 for Evergreen Small Company
Growth Fund (formerly Keystone Small Company Growth Fund (S-4))
incorporated by reference herein;

* the use of our report dated October 31, 1997 for Evergreen Strategic Growth
Fund (formerly Keystone Strategic Growth Fund (K-2)) incorporated by
reference herein; and

* the references to our firm under the caption "Financial Highlights" in
the prospectuses.

/s/ KPMG Peat Marwick LLp
KPMG Peat Marwick LLP

Boston, Massachusetts
January 30, 1997