<PAGE>
Annual Report
as of October 31, 1999
Evergreen International and Global Growth Funds
[LOGO OF EVERGREEN FUNDS]
<PAGE>
Table of Contents
Letter to Shareholders ................................................... 1
Evergreen Emerging Markets Growth Fund
Fund at a Glance ...................................................... 2
Portfolio Manager Interview ........................................... 3
Evergreen Global Leaders Fund
Fund at a Glance ...................................................... 7
Portfolio Manager Interview ........................................... 8
Evergreen Global Opportunities Fund
Fund at a Glance ...................................................... 11
Portfolio Manager Interview ........................................... 12
Evergreen International Growth Fund
Fund at a Glance ...................................................... 15
Portfolio Manager Interview ........................................... 16
Evergreen Latin America Fund
Fund at a Glance ...................................................... 19
Portfolio Manager Interview ........................................... 20
Evergreen Perpetual International Fund
(formerly Mentor Perpetual International Portfolio)
Fund at a Glance ...................................................... 24
Portfolio Manager Interview ........................................... 25
Evergreen Precious Metals Fund
Fund at a Glance ...................................................... 28
Portfolio Manager Interview ........................................... 29
Financial Highlights
Evergreen Emerging Markets Growth Fund ................................ 31
Evergreen Global Leaders Fund ......................................... 33
Evergreen Global Opportunities Fund ................................... 35
Evergreen International Growth Fund ................................... 37
Evergreen Latin America Fund .......................................... 39
Evergreen Perpetual International Fund ................................ 41
Evergreen Precious Metals Fund ........................................ 43
Schedule of Investments
Evergreen Emerging Markets Growth Fund ................................ 45
Evergreen Global Leaders Fund ......................................... 49
Evergreen Global Opportunities Fund ................................... 52
Evergreen International Growth Fund ................................... 55
Evergreen Latin America Fund .......................................... 59
Evergreen Perpetual International Fund ................................ 61
Evergreen Precious Metals Fund ........................................ 66
Statements of Assets and Liabilities ..................................... 68
Statements of Operations ................................................. 69
Statements of Changes in Net Assets ...................................... 70
Combined Notes to Financial Statements ................................... 72
Independent Auditors' Report ............................................. 85
Additional Information (unaudited) ....................................... 86
Evergreen Funds
Evergreen Funds is one of the nation's fastest growing investment companies with
approximately $80 billion in assets under management.
With over 80 mutual funds to choose among and acclaimed service and operations
capabilities, investors enjoy a broad range of quality investment products and
services designed to meet their needs.
The Evergreen Funds employ intensive, research-driven investment strategies
executed by over 90 research analysts and portfolio managers. The fund company
remains dedicated to meeting the needs of investors and their advisors in a
global economy. Look to the Evergreen Funds to provide a distinctive level of
service and excellence in investment management.
This annual report must be preceded or accompanied by a prospectus of an
Evergreen fund contained herein. The prospectus contains more complete
information, including fees, charges and other ongoing expenses, and should be
read carefully before investing or sending money.
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Mutual Funds: ARE NOT FDIC INSURED May lose value . Are not bank guaranteed
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Evergreen Distributor, Inc.
Evergreen(SM) is a Service Mark of Evergreen Investment Services, Inc.
<PAGE>
Letter to Shareholders
----------------------
December 1999
[PHOTO OF WILLIAM M. ENNIS]
William M. Ennis
President and CEO
Dear Shareholders,
We are pleased to provide the Evergreen International and Global Growth Funds
annual report, which covers the twelve-month period ended October 31, 1999.
U.S. Economy Acts as Engine for Global Economic Growth
The global economy recovered strongly during the twelve-month period after the
financial problems that precipitated the crisis in Asia, Russia and Latin
America during 1998. Almost all the world's economies rebounded to their
pre-crisis levels with the U.S. economy leading the way.
Although the U.S. economy is in the ninth year of economic expansion, many
believe that valuation levels in some sectors of the stock market are just not
sustainable. The S&P 500 continued to advance in the first half of 1999,
dominated by the performance of a very small group of large-cap stocks.
By the 3rd quarter of 1999, rising interest rates dampened performance of stocks
across the board. Investors' inflation fears and continued doubts about the
ability of U.S. companies to sustain significant growth in earnings prompted an
October sell-off. The Federal Reserve Bank's "tightening bias" leads many to
anticipate further interest rate increases in order to stem even the slightest
inflationary pressure.
Around the world, emerging markets recovered, particularly in Asia, where Japan
was finally able to climb out of its protracted recession. Economic growth in
Europe accelerated as a result of a number of positive economic factors,
including rising consumer spending and increased corporate restructuring;
however, deterioration in the value of the euro held back returns for foreign
investors. Latin American markets recovered substantially during the period,
although volatility continued there. Overall, our outlook is positive for the
U.S., Europe, Latin America and Asia.
Evergreen Funds is Ready for the Year 2000/1/
We have been addressing the Year 2000 challenge since February of 1996 and have
committed the time, resources and people necessary to prepare for any
ramifications from the millennium bug. Today, we are confident that our
preparations will enable us to continue to deliver the high-quality Evergreen
products and services on which our shareholders rely. In addition, Evergreen
portfolio managers have placed great emphasis on monitoring portfolios for Y2K
readiness.
We believe that sound investing is about taking steps to meet your long-term
financial needs and goals. We remind you to take advantage of your financial
advisor's expertise to develop and refine a financial plan that will enable you
to meet your objectives. Evergreen Funds offers a broad mix of stock, bond and
money market funds that should make it simple for you to choose the most
appropriate for your portfolio.
We would like to thank you for your continued investment in Evergreen Funds.
Sincerely,
/s/ William M. Ennis
William M. Ennis
President and CEO
Evergreen Investment Company
/1/The information above constitutes Year 2000 readiness disclosure.
1
<PAGE>
EVERGREEN
Emerging Markets Growth Fund
Fund at a Glance as of October 31, 1999
"We see the potential for continued revival and growth in emerging markets."
Portfolio
Management
Francis Claro Antonio Docal
Tenure: May 1999 Tenure: May 1999
Liu-Er Chen Eleanor Marsh
Tenure: May 1999 Tenure: May 1999
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CURRENT INVESTMENT STYLE1
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[STYLE BOX]
Morningstar's Style Box is based on a portfolio date as of 10/31/1999.
The Equity Style Box placement is based on a fund's price-to-earnings and
price-to-book ratio relative to the S&P 500, as well as the size of the
companies in which it invests, or median market capitalization.
1 Source: 1999 Morningstar, Inc.
2 Past performance is no guarantee of future results. The performance of each
class may vary based on differences in loads, fees and expenses paid by the
shareholders investing in each class. The investment return and principal value
will fluctuate so that an investor's shares, when redeemed, may be worth more or
less than original cost.
International investing involves increased risk and volatility.
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Performance and Returns2
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Portfolio Inception Date: 9/6/1994 Class A Class B Class C Class Y
Class Inception Date 9/6/1994 9/6/1994 9/6/1994 9/6/1994
Average Annual Returns*
1 year with sales charge 12.60% 12.32% 16.60% n/a
1 year w/o sales charge 18.16% 17.32% 17.60% 18.57%
3 years 2.54% 2.39% 3.41% 4.53%
5 years -0.67% -0.89% -0.47% 0.57%
Since Portfolio Inception -1.66% -1.67% -1.47% -0.46%
Maximum Sales Charge 4.75% 5.00% 1.00% n/a
Front End CDSC CDSC
12-month income dividends
per share $0.01 $0.01 $0.01 $0.02
* Adjusted for maximum applicable sales charge unless noted.
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LONG TERM GROWTH
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[LINE GRAPH]
MSCI EAFE Evergreen Emerging MSCI Emerging
CPI Index Mkts Growth A Markets Free
9/30/94 10,000 10,000 9,522 10,000
10/31/94 10,007 10,335 9,250 9,795
10/31/95 10,288 10,328 7,700 7,725
10/31/96 10,596 11,444 8,305 8,121
10/31/97 10,817 12,007 9,805 7,284
10/31/98 10,977 13,202 7,945 5,023
10/31/99 11,292 16,287 9,387 7,559
Comparison of a $10,000 investment in Evergreen Emerging Markets Growth Fund,
Class A shares2, versus a similar investment in the Morgan Stanley Capital
International Emerging Markets Free Index (MSCI EMF), the Morgan Stanley Capital
International Europe, Australasia, and Far East Index (MSCIEAFE) and the
Consumer Price Index (CPI).
The MSCI EMF and the MSCI EAFE are unmanaged market indices which do not include
transaction costs associated with buying and selling securities nor any
management fees. The CPI is a commonly used measure of inflation and does not
represent an investment return. It is not possible to invest directly in an
index.
<PAGE>
EVERGREEN
Emerging Markets Growth Fund
Portfolio Manager Interview
How did the Fund perform?
For the twelve-month period ended October 31, 1999, the Evergreen Emerging
Markets Growth Fund Class A shares had a total return of 18.16%. During the same
period, the Morgan Stanley Capital International Emerging Markets Free Index
(MSCI EMF) had a return of 44.63%. The median return of mutual funds in the
Emerging Markets Fund Category was 35.75%, according to Lipper Inc., an
independent monitor of mutual fund performance. Fund returns are before
deduction of any applicable sales charges.
While the Fund's performance lagged the emerging market benchmarks for the full
twelve-month period, the Fund outperformed both the MSCI EMF and the Lipper
funds average during the final five months of the fiscal year, as the new
management team repositioned the portfolio. At the start of the fiscal period,
the Fund's conservative posture, with a 38% cash position, held back performance
during a period in which emerging market stocks appreciated rapidly. That
conservative posture, however, had helped the Fund outperform the benchmarks
during the extreme volatility of 1997 and 1998. Going forward, the management
team intends to keep the Fund fully invested in the markets of developing
nations as represented in the MSCI EMF Index.
Portfolio
Characteristics
------------------
(as of 10/31/1999)
Total Net Assets $65,237,913
Number of Holdings 159
What was the investment environment like during the twelve-month period?
Most emerging markets recovered from the financial crisis of the previous two
years. In Asia, where the crisis began in the summer of 1997, economies came
back strongly, although at different rates of growth. In South Korea, rapid
economic growth helped the economy and the equity market recover to pre-crisis
levels. In Taiwan, strong growth in technology industries fueled stock
performance early in 1999, although the market was held back later in the period
because of political tensions with China and concern about the effect an
earthquake might have had on the semiconductor industry. In Latin America, the
largest, blue-chip companies in the region's biggest economies--Mexico and
Brazil--led the revival.
What factors contributed to the recovery in emerging markets?
First, there was a growing belief that the global economy was healing. The
United States appeared to be heading to a "soft landing" of moderate economic
growth after a period in which investors worried that excessive growth would
lead to inflation and then to recession. Meanwhile, economic growth in Europe
was accelerating, while Japan began to climb out of its prolonged recession.
Emerging markets finally began to pull out of recession and to recover from the
currency devaluations of 1997 and 1998. The emerging nations were helped by the
strong support of the International Monetary Fund (IMF) and the world's
industrialized economies. All these factors together worked to stabilize
emerging market economies, which began to grow again in 1999.
3
<PAGE>
EVERGREEN
Emerging Markets Growth Fund
Portfolio Manager Interview
Second, commodity prices increased. The price of a barrel of oil increased, as
did the prices of copper and other metals. Many emerging market economies are
producers of commodities and benefit with higher commodity prices.
Third, Gross Domestic Product (GDP) growth accelerated. In South Korea, GDP is
expected to grow by 9% for 1999, while GDP growth in Latin America started
climbing from a 1.1% rate in 1998 and continues to rise towards an anticipated
rate of more than 4% in 2000. Even those economies that did not grow
substantially appeared to stabilize after the downward spiral that began in
1997.
Fourth, corporate earnings rose. Profits were driven by the revenue growth that
accompanies faster economic growth. After the economic crisis of 1997 and 1998,
many manufacturing, mining and retailing companies in emerging markets had
excess capacity, which meant that they could absorb substantial increases in
business revenues without making major capital investments. The result was
higher earnings.
Fifth, stock valuations were attractive. Not only did stock prices appear cheap
in relation to the valuations in developed economies, but they also appeared
attractive in relation to historical patterns in emerging markets.
Finally, money flows increased in the region. International investment
institutions allocated more money to emerging markets after witnessing strong
rallies in emerging markets throughout the world.
Can you explain the continuing volatility in the region?
While these factors all contributed to the strengthened environment for emerging
market investing, market volatility did not disappear. Some concerns were
related to regional issues, such as tensions between Taiwan and China, while
others were related to general concerns about the extent of the global economic
recovery. In particular, international investors watched events in the United
States, worried that anti-inflationary steps by the Federal Reserve Board could
restrict the flow of capital to emerging markets. By the end of the twelve-month
period, however, it appeared that the U.S. Federal Reserve would limit its rate
increases to three and that the U.S. economy would have a "soft landing" without
falling into recession.
What strategies did the investment team employ in managing the Fund?
We positioned the Fund's portfolio to be broadly reflective of the world's
emerging markets, with the largest allocations to the biggest, most liquid
economies: Korea, Taiwan, Mexico, Brazil, India and South Africa. We have become
much more aggressive in our willingness to take advantage of the growth
opportunities in emerging markets, emphasizing investments in Asia and Latin
America, while de-emphasizing markets in Europe, the Middle East and Africa. We
have lowered the Fund's cash position to just 2% of net assets.
Top 10 Countries
----------------------------------------
(as a percentage of 10/31/1999 net assets)
Korea 15.0%
Taiwan 11.3%
Mexico 11.2%
Brazil 8.6%
India 7.9%
South Africa 7.7%
Greece 4.3%
Turkey 3.9%
Indonesia 3.3%
Israel 3.1%
4
<PAGE>
EVERGREEN
Emerging Markets Growth Fund
Portfolio Manager Interview
We emphasize individual stock analysis and selection. During the past twelve
months, members of the investment team have made on-site visits to companies in
Taiwan, South Korea, Hong Kong, Singapore, Malaysia, China, Brazil, Argentina,
Mexico, Chile, South Africa, Russia, Turkey, Egypt, Poland, Hungary, Israel and
Greece. While each stock is chosen individually, in the aggregate the Fund's
portfolio has the largest concentrations in the fast-growing telecommunications
industry, followed by banking, electronics and the beverages and tobacco
industry.
Top 5 Industries
--------------------------------------
(as a percentage of 10/31/1999 net assets)
Telecommunications 24.5%
Banking 16.2%
Electronic Components 9.4%
Beverages & Tobacco 5.4%
Multi-Industry 4.7%
What are some of the investments that illustrate your strategies?
Many of our most successful investments are related to technology and are found
in the largest, most liquid of the emerging markets.
The Fund's largest holding at the end of the year was Telefonos de Mexico SA, or
Telmex. It is Mexico's largest telephone company, with dominant market positions
in both the fixed-wire and wireless markets. Telmex has aggressively defended
its market share in the traditional telephone business, even as utility
deregulation has come to Mexico, while increasing its share in the rapidly
expanding wireless business. Moreover, it has launched a new, fixed, wireless
business that enables it to extend telephone service to regions where the costs
of traditional wire service would be prohibited. Telmex also has entered into
alliances with major international technology companies to invest in internet
operations in Latin America.
Telmex also has maintained an aggressive stock-buyback program during the past
year, which has helped support the price of its stock. In the future, Telmex
possibly could become part of a global telecommunications consortium.
We also have major telecommunications-related investments in Greece, South
Korea, and India.
The Fund's second largest position is in Samsung Electronics of South Korea, a
holding we have added to during the period. A major force in electronics,
Samsung is a market leader in the manufacture of DRAM memory chips, wireless
telephone systems, and new, thin-film transistors called LCDs. Samsung has
emerged as a global industry leader, with advanced technology on a par with
leading companies in the U.S. and Japan, but with a stock price trading at very
attractive valuations. It is one of a number of leading Korean technology
companies in which the Fund has invested.
Taiwan Semiconductor, the Fund's third largest holding, is one of the world's
leading semiconductor chip suppliers. It has been a primary beneficiary as the
U.S. and Japanese technology companies outsourced production.
An interesting investment in a very different industry is Embraer, a Brazilian
company, which has become one of the world's dominant regional jet aircraft
manufacturers. It gained a majority of the market share of the planes that are
replacing turbo-prop aircraft used for commuter and other short-flight
commercial routes. Embraer, whose planes have earned a reputation for efficiency
and low cost, currently has a backlog of $18 billion in orders from companies
such as American Airlines, Continental Airlines, British Airways, Swissair and
other leading airlines.
Embraer recently signed partnership agreements with a consortium of French
defense contractors and likely will begin manufacturing the Mirage jet fighters
for air forces around the world. This agreement marks Embraer's renewed strength
in the military as well as the commercial aviation market.
5
<PAGE>
EVERGREEN
Emerging Markets Growth Fund
Portfolio Manager Interview
Top 10 Holdings
------------------------------------
(as a percentage of 10/31/1999 net assets)
Telefonos de Mexico SA, ADR "Telmex" 4.2%
Samsung Electronics 4.0%
Taiwan Semiconductor 2.6%
Hellenic Telecommunications
Organization SA, GDR 2.0%
Korea Telecom Corp. 1.6%
Mahanagar Telephone Nigam Ltd., GDR 1.5%
Korea Electric Power Corp., ADR 1.5%
Housing & Commercial Bank 1.3%
Reliance Industries Ltd., GDR, 144A 1.3%
Embraer-Empresa Brasileira de Aeronautica SA 1.3%
What is your outlook for investing in emerging markets?
We see the potential for continued revival and growth in emerging markets. Most
of the favorable factors that contributed to the recovery during the past year
are still in effect, and most stock valuations still are attractive, especially
compared to valuations in the United States. We should point out that investor
confidence remains fragile, and we expect short-term volatility to continue in
emerging markets.
In Asia, most economies are enjoying significant trade surpluses, especially
with Japan and the United States. The region's technology companies are strong
competitors in the global markets as well as beneficiaries of the desire of many
U.S. companies to outsource production operations. The World Trade Organization
Treaty signed by China and the United States in November, 1999 could have a
positive impact on many Asian economies. In addition, countries in Southeast
Asia tend to be low-tax nations with relatively small deficits that contribute
to a favorable business climate.
Latin America continues to be highly influenced by its proximity to the United
States, where the economy appears to be heading to a "soft landing" that avoids
either a major pickup in inflation or a fallback into recession. Growth is
increasing, stock prices remain relatively attractive, and trade with
industrialized nations is increasing. Many Latin American companies,
particularly in Mexico, are prime beneficiaries of the trend for U.S.
corporations to outsource production operations.
In general, we are more optimistic than we have been in several years.
6
<PAGE>
EVERGREEN
Global Leaders Fund
Fund at a Glance as of October 31, 1999
"In general, we witnessed a period of synchronized global recovery,
characterized by general economic growth and a trend of corporations to
restructure themselves to improve their productivity."
Portfolio Management
- -----------------------
[PHOTO OF EDWIN D. MISKA]
Edwin D. Miska, CFA
Tenure: November 1995
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CURRENT INVESTMENT STYLE/1/
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[STYLE BOX]
Morningstar's Style Box is based on a portfolio date as of 10/31/1999.
The Equity Style Box placement is based on a fund's price-to-earnings and price-
to-book ratio relative to the S&P 500, as well as the size of the companies in
which it invests, or median market capitalization.
/1/ Source: 1999 Morningstar, Inc.
/2/ Past performance is no guarantee of future results. The performance of each
class may vary based on differences in loads, fees and expenses paid by the
shareholders investing in each class. The investment return and principal value
will fluctuate so that an investor's shares, when redeemed, may be worth more or
less than original cost.
Historical performance shown for Classes A, B and C prior to their inception is
based on the performance of Class Y, the original class offered. The historical
returns for Classes A, B and C have not been adjusted to reflect the effect of
each Class' 12b-1 fees. These fees for Class A are 0.25%, for Class B are 1.00%,
and for Class C are 1.00%. Class Y does not pay a 12b-1 fee. If these fees had
been reflected, returns would have been lower.
International investing involves increased risk and volatility.
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PERFORMANCE AND RETURNS/2/
- --------------------------------------------------------------------------------
Portfolio Inception Date: 11/1/1995 Class A Class B Class C Class Y
Class Inception Date 6/3/1996 6/3/1996 6/3/1996 11/1/1995
Average Annual Returns*
1 year with sales charge 16.88% 16.90% 20.95% n/a
1 year w/o sales charge 22.74% 21.90% 21.95% 23.19%
3 years 13.85% 14.15% 14.88% 16.09%
Since Portfolio Inception 15.24% 15.48% 15.92% 16.95%
Maximum Sales Charge 4.75% 5.00% 1.00% n/a
Front End CDSC CDSC
* Adjusted for maximum applicable sales charge unless noted.
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LONG TERM GROWTH
- --------------------------------------------------------------------------------
Evergreen Global
Leaders A Consumer Price Index MSCI World
Period End Market Value - US Value Index Value
6/96 9,527 10,000 10,000
10/96 9,876 10,106 10,218
10/97 11,346 10,316 11,980
10/98 12,460 10,470 13,860
10/99 15,294 10,770 17,370
Comparison of a $10,000 investment in Evergreen Global Leaders Fund, Class A
shares/2/, versus a similar investment in the Morgan Stanley Capital
International World Index (MSCI World) and the Consumer Price Index (CPI).
The MSCI World is an unmanaged market index which does not include transaction
costs associated with buying and selling securities nor any management fees. The
CPI is a commonly used measure of inflation and does not represent an investment
return. It is not possible to invest directly in an index.
7
<PAGE>
EVERGREEN
Global Leaders Fund
Portfolio Manager Interview
How did the Fund perform?
For the twelve-month period ended October 31, 1999, the Evergreen Global Leaders
Fund Class A shares had a total return of 22.74%. During the same twelve-month
period, the Morgan Stanley Capital International World Index (MSCI World), a
commonly used benchmark of world stock market performance, returned 24.91% and
the median return of funds in the global fund category was 24.42%, according to
Lipper Inc., an independent monitor of mutual fund performance. Fund performance
figures are before deduction of any applicable sales charges.
While the Fund performed well by following its discipline of investing in
large-cap industry leaders in the world's most developed economies, its
performance lagged that of some benchmarks during a year that rewarded
strategies emphasizing emerging markets and small-company stocks.
Portfolio
Characteristics
------------------
(as of 10/31/1999)
Total Net Assets $444,766,731
Number of Holdings 114
What was the environment like during the twelve-month period?
The global economy recovered strongly from the financial problems that had
precipitated a crisis in Asia, Russia and Latin America during the previous
year. Virtually all financial markets rebounded to their previous, pre-crisis
levels, with the U.S. economy leading the way with steady growth, low interest
rates, low inflation and rising productivity. In Europe, positive factors
included rising consumer spending and an increase in corporate restructuring and
cost-cutting programs, but deterioration in the value of the new currency--the
euro--held back the returns for foreign investors. Asian markets, which had
suffered through the most severe problems from the economic crisis, gradually
showed recovery as their currencies stabilized in value and corporations again
started growing their revenues and earnings. In general, we witnessed a period
of synchronized global recovery, characterized by general economic growth and a
trend of corporations to restructure themselves to improve their productivity.
Top 5 Industries
----------------
(as a percentage of 10/31/1999 net assets)
Merchandising 19.3%
Health & Personal Care 9.5%
Financial Services 9.4%
Electrical & Electronics 7.4%
Food & Household Products 6.0%
At the end of the year, you continued to have a heavy weighting in the United
States, at about 50% of the Fund's net assets. What was your strategy in the
U.S.?
We emphasized the United States as the leading economy in the world, home to
many of the companies that dominate their industries. Each of our top five
domestic investments turned in what we believe was superlative performance. Our
largest U.S. holding, Wal-Mart, was up 164% during the twelve-month period;
Cisco Systems, the second largest holding, had a return of 135%; and Microsoft,
the third largest holding, was up 75%. Citigroup, which had a 74% return during
the twelve-month period, and
8
<PAGE>
EVERGREEN
Global Leaders Fund
Portfolio Manager Interview
General Electric, which returned 55%, were the Fund's fourth and fifth largest
U.S. investments. Other top performers in the domestic portion of the portfolio
included the broker Charles Schwab, up 168% during the fiscal year; the Tribune
Company, parent of the Chicago Tribune and other businesses, up 109%; and Oracle
Systems, up 139%.
Top 10 Countries
----------------
(as a percentage of 10/31/1999 net assets)
United States 49.5%
Japan 8.4%
United Kingdom 7.4%
Germany 6.0%
Italy 4.9%
France 4.4%
Netherlands 4.4%
Canada 3.2%
Switzerland 2.0%
Finland 1.6%
What were some of the foreign investments that contributed to performance?
Our overall foreign investments performed in line with international benchmarks,
rising 19.2% for the twelve months ended October 31, 1999. The conservative
mandate of the Fund, which is to focus on larger companies in developed nations,
subdued overall return potential as emerging and smaller cap strategies
significantly outperformed this year. In addition, the negative impact of
foreign currency translations detracted from returns.
We tended to keep our country allocations consistent during the period, although
the weighting in Japan increased from 5% to 8% of net assets at the end of the
year, partly because we cautiously increased our emphasis in Japan and partly
because of the appreciated value of holdings. The Japanese stock market, which
has been mired in a slump for most of the decade, seems to be recovering. In
fact, two of the Fund's standout performers were Japanese corporations.
Seven-Eleven Japan, Inc., a chain of convenience stores, rose 148% during the
period; and electronic game company, Nintendo, was up 83%. Our average Japanese
stock holding rose by 122% during the fiscal year.
The Fund's investments in Hong Kong also performed well, rising by an average of
22% during the year. Leading performers included Cheung Kong Holdings, a real
estate developer with a 33% return, and National Mutual Asia, an insurance
company that produced a 27% return for the Fund.
We had a very small position in the Malaysian market because of our concerns
about market volatility. Nevertheless, the average stock there rose by 118%
during the period.
Our investments in Europe were somewhat disappointing largely because the new,
common currency for 11 European nations--the euro--fell in value by 12% since
its introduction in January 1999. With about 40% of the Fund's assets invested
in Europe, the poor performance of the currency undercut a major part of the
gains from stock selection.
Despite the poor performance of the currency, the Fund did have good performance
from several European-based stocks, notably Nokia Corp., the Finland-based
telecommunications equipment giant, which rose by 148%. In addition, the Fund's
investments in France did very well, averaging 21% gains during the fiscal year.
The best-performing French holding was the retailer Carrefour, which had a 67%
return.
9
<PAGE>
EVERGREEN
Global Leaders Fund
Portfolio Manager Interview
Investments in Italy also did well, averaging gains of 37%. The best-performing
Italian investment for the Fund was eyeglass-frame manufacturer and retailer
Luxottica Group, which rose by 112%.
In Ireland, the Fund had just one holding--building materials company CRH
Plc--which had a 30% return.
Top 10 Holdings
---------------
(as a percentage of 10/31/1999 net assets)
Seven-Eleven Japan Co. Ltd. 5.2%
Nintendo Co., Ltd. 3.2%
Wal-Mart Stores, Inc. 2.6%
Cisco Systems, Inc. 2.5%
Microsoft Corp. 2.5%
Citigroup, Inc. 2.3%
General Electric Co. 2.1%
Bombardier, Inc., Cl. B 2.0%
Benetton Group SpA ADS 1.7%
RWE AG 1.6%
Were there disappointments?
The Fund's investments in Germany tended to do poorly, losing an average of 17%.
Among the more disappointing investments in Germany were the conglomerate RWE,
which lost 25.6%, and software company SAP, which was down 19.6%. The
investments in Spain, which fell by an average of 24%, and in Switzerland, which
lost an average of 11%, also failed to meet expectations.
Despite these disappointing returns from many of our European investments, we
remain optimistic about their longer-term prospects. Many companies in Europe
are undergoing restructuring programs to improve their efficiency and
competitiveness, and we think they have the potential to produce sustained,
positive stock performance.
What is your outlook?
Our overall outlook is positive. We see the opportunity for continued strong
performance from U.S. holdings, where we have a large group of multinational
corporations that should benefit from the strengthening of the global economy.
We also believe that many of our European investments have the potential to
increase their earnings growth rates as the effects of their restructuring and
cost-cutting programs take hold. In Asia, the regional economy continues to
improve gradually, and we will be watchful for new opportunities in which to
invest.
Our investment strategy continues to rely on a discipline that emphasizes
fundamental analysis and individual stock selection. We search for companies
that show persistent earnings leadership over a longer period of time and that
demonstrate their ability to expand their businesses even as economic conditions
change. We believe companies with sound management teams and strong balance
sheets should be best positioned to profit from emerging opportunities.
10
<PAGE>
EVERGREEN
Global Opportunities Fund
Fund at a Glance as of October 31, 1999
"Our investment style is to concentrate on searching for attractive stocks,
rather than broad, top-down economic analysis."
Portfolio Management
--------------------
[PHOTO OF GARY CRAVEN] [PHOTO OF GILMAN GUNN]
Gary Craven Gilman Gunn
Tenure: January 1998 Tenure: June 1997
- --------------------------------------------------------------------------------
CURRENT INVESTMENT STYLE/1/
- --------------------------------------------------------------------------------
[STYLE BOX]
Morningstar's Style Box is based on a portfolio date as of 10/31/1999.
The Equity Style Box placement is based on a fund's price-to-earnings and price-
to-book ratio relative to the S&P 500, as well as the size of the companies in
which it invests, or median market capitalization.
/1/ Source: 1999 Morningstar, Inc.
/2/ Past performance is no guarantee of future results. The performance of each
class may vary based on differences in loads, fees and expenses paid by the
shareholders investing in each class. The investment return and principal value
will fluctuate so that an investor's shares, when redeemed, may be worth more or
less than original cost.
Historical performance shown for Classes B, C and Y prior to their inception is
based on the performance of Class A, the original class offered. The historical
returns for Classes B, C and Y have not been adjusted to reflect the effect of
each Class' 12b-1 fees. These fees for Class A are 0.25%, for Class B are 1.00%,
and for Class C are 1.00%. Class Y does not pay a 12b-1 fee. If these fees had
been reflected, returns for Classes B and C would have been lower while returns
for Class Y would have been higher.
International investing involves increased risk and volatility.
Smaller capitalization stock investing may offer the potential for greater
long-term results; however, it is also generally associated with greater price
volatility due to the higher risk of failure.
- --------------------------------------------------------------------------------
Performance and Returns/2/
- --------------------------------------------------------------------------------
Portfolio Inception Date: 3/16/1988 Class A Class B Class C Class Y
Class Inception Date 3/16/1988 2/1/1993 2/1/1993 1/13/1997
Average Annual Returns*
1 year with sales charge 37.20% 38.02% 41.98% n/a
1 year w/o sales charge 44.04% 43.02% 42.98% 42.20%
3 years 7.79% 7.89% 8.74% 9.65%
5 years 8.50% 8.46% 8.73% 9.62%
10 years 12.47% 12.46% 12.48% 13.04%
Since Inception 11.73% 11.72% 11.74% 12.22%
Maximum Sales Charge 4.75% 5.00% 1.00% n/a
Front End CDSC CDSC
12-month capital gain
distributions per share $1.22 $1.22 $1.22 $1.22
* Adjusted for maximum applicable sales charge unless noted.
- --------------------------------------------------------------------------------
LONG TERM GROWTH
- --------------------------------------------------------------------------------
[LINE GRAPH]
CPI MSCI World Index Evergreen Global Opp A
10/31/89 10,000 10,000 9,526
10/31/90 10,629 8,923 9,297
10/31/91 10,939 10,389 12,062
10/31/92 11,290 9,904 12,249
10/31/93 11,600 12,645 18,740
10/31/94 11,903 13,678 20,509
10/31/95 12,237 15,050 23,735
10/31/96 12,604 17,584 24,625
10/31/97 12,866 20,617 25,672
10/31/98 13,057 23,851 22,494
10/31/99 13,432 29,893 32,385
Comparison of a $10,000 investment in Evergreen Global Opportunities Fund, Class
A shares/2/, versus a similar investment in the Morgan Stanley Capital
International World Index (MSCI World) and the Consumer Price Index (CPI).
The MSCI World is an unmanaged market index which does not include transaction
costs associated with buying and selling securities nor any management fees. The
CPI is a commonly used measure of inflation and does not represent an investment
return. It is not possible to invest directly in an index.
11
<PAGE>
EVERGREEN
Global Opportunities Fund
Portfolio Manager Interview
How did the Fund perform?
The Evergreen Global Opportunities Fund had very strong performance this year.
For the twelve-month period ended October 31, 1999, the Fund's Class A shares
had a total return of 44.04%. During the same period, the MSCI World Index, a
benchmark for world stock markets, had a return of 24.91% and the median return
of Global Small Cap Funds was 26.82%, according to Lipper Inc., an independent
monitor of mutual fund performance. Fund returns are before deduction of any
applicable sales charges.
Portfolio
Characteristics
----------------
(as of 10/31/1999)
Total Net Assets $184,993,741
Number of Holdings 157
What was the investment environment like for small company stocks during the
period?
Small company stocks showed renewed vitality throughout the world, particularly
in the United States and especially in the technology sector. Outside the United
States, over-the-counter stocks in Japan emerged as the performance leaders.
Small-cap performance in Europe tended to lag the performance in the United
States and Japan.
How have the assets been allocated, between the U.S. and foreign markets?
While the Fund began the fiscal year with a relatively heavy emphasis on foreign
markets, for most of the year the allocation was evenly divided between domestic
and foreign stocks to take advantage of the strong opportunities available in
the United States. At the close of the fiscal year, on October 31, 1999, the
Fund's target allocation was 45% U.S. and 55% foreign.
What were the primary factors contributing to performance in the United States?
G. Craven: It was the year of technology, with stock performance driven by the
appetite for the tremendous productivity gains realized through the use of
technology. Most of the market performance came from the internet and its
effects on both consumers and businesses. The strongest opportunities during the
year were related to the build-out of telecommunications systems. The Fund
benefited from its exposure to the semiconductor industry. One semiconductor
stock--PMC Sierra--accounted for 10% of the Fund's returns in the U.S. As
businesses interfaced with their customers and suppliers electronically, the
demand grew for new systems. This helped the performance of Fund investments
such as Silknet Software and Broadvision, which was sold during the period.
While technology in general and telecommunications in particular were the main
factors contributing to performance, the Fund also was helped by a strategic
rotation into the stocks of cyclical companies, whose fortunes tend to rise and
fall with the strength of the economy. In the spring, as it became apparent that
we were not heading into a global recession, many cyclical companies offered
strong earnings outlooks and attractive stock prices. A good example is Eagle
U.S. Airfreight, Inc., an airfreight scheduling company that benefited from the
increase in trade between Asia and the United States. During the summer, we also
increased our energy-related holdings substantially. Energy companies benefited
as the price of oil rose from $14 to $20 a barrel.
12
<PAGE>
EVERGREEN
Global Opportunities Fund
Portfolio Manager Interview
During the fall, we again shifted weightings in the Fund, heavily overweighting
software companies. These companies benefited as corporations invested in
productivity-enhancing systems that helped them better manage their assets. The
stocks of software companies such as Great Plains Software surged in this trend.
One area that we tended to de-emphasize throughout the year was the financial
services industry. Two years ago, this industry comprised more than 20% of U.S.
investments, but in 1999 it accounted for just 5%, primarily because we were
able to find better opportunities elsewhere.
Top 5 Industries
----------------
(as a percentage of 10/31/1999 net assets)
Business & Public Services 13.8%
Technology 12.8%
Telecommunications 7.7%
Health & Personal Care 6.6%
Machinery & Engineering 6.0%
What were some of the other investments that supported performance in the United
States?
G. Craven: Most of the returns came from technology. One outstanding performer
was Exodus Communications, which operates network management systems for
corporations. We bought the stock at $18 a share and sold it at an average price
of $75. Another strong technology holding was Clarify, which is the subject of a
pending acquisition by Nortel. We purchased the stock in August at $35 a share
and saw it rise to $77 a share.
Even stocks seemingly unrelated to technology have been beneficiaries of the
growth of the internet. A good example is Lamar Advertising, a billboard
company. It and other advertising companies have prospered as the large number
of internet companies have gone public and have used advertising to raise brand
awareness for themselves and their products. Other strong performers for the
Fund were the bus line, Coach USA; shoe company, Nine West; and the direct
marketing company, Abacus. All three companies were acquired by other companies
at substantial premiums to their stock valuations.
Top 10 Holdings
---------------
(as a percentage of 10/31/1999 net assets)
Yahoo Japan Corp. 1.7%
Silknet Software, Inc. 1.7%
Lindt & Spruengli AG 1.7%
Hikari Tsushin, Inc. 1.6%
Clarify, Inc. 1.5%
Trend Micro, Inc. 1.5%
Aegis Group Plc 1.4%
Computershare Ltd. 1.4%
Mediolanum SpA 1.4%
Diamond Technology Partners, Inc. 1.3%
Gilman, what were the main factors affecting performance in the international
portion of the portfolio?
G. Gunn: The primary factors were the performance of technology industry stocks
and the extremely strong rebound in the Japanese over-the-counter market. Both
trends came together in the significant performance of Yahoo Japan, the largest
holding of the Fund at the end of the fiscal year. This company, which is partly
owned by Yahoo in the United States, is the dominant internet company in Japan.
The company's stock price rose 850% since we bought it earlier this year.
The small-cap stock market in Japan has done extremely well this year partly in
sympathy with the U.S. small-cap stock market, but also because many Japanese
investment trusts have allocated new investment money into the high tech sector.
13
<PAGE>
EVERGREEN
Global Opportunities Fund
Portfolio Manager Interview
In general, we have sought to invest in small companies with unique products or
services and dominant market positions, either globally or regionally. During
the fiscal year, while many Japanese stock holdings had superior returns, fund
performance also has been supported by selected investments in Australia and
Europe. In general, however, European small company stocks lagged other parts of
the equity market during the past year. As the euro--the single currency for 11
nations in Europe--was introduced, many investors sold their domestic small-cap
holdings to buy foreign, European large-cap investments that no longer carried
any currency risk because of the new, common currency.
Very recently, as evidence grew of the economic revival in emerging markets, we
have allocated about 6% of net assets in emerging markets, primarily Mexico and
Brazil.
Top 10 Countries
----------------
(as a percentage of 10/31/1999 net assets)
United States 52.2%
Japan 13.4%
United Kingdom 10.1%
Switzerland 4.9%
Australia 3.3%
France 2.8%
Germany 2.6%
Netherlands 1.8%
Italy 1.5%
Ireland 1.5%
What were some of the foreign investments that contributed to performance?
G. Gunn: Yahoo Japan, which I mentioned earlier, was the biggest winner. One
very interesting and strongly performing stock was Cannons in the United
Kingdom, which operates physical fitness centers in the United Kingdom. The
stock has risen by 52% since we bought it two years ago, helped by the rising
interest in physical fitness. Sonic Healthcare was one of the major performers
in Australia. This company, through a series of acquisitions as well as internal
growth, has built up a significant medical testing business in Australia. It has
benefited as hospitals have preferred outsourcing to operating their own
internal test centers. Sonic's centers tend to be able to perform the tests more
efficiently than hospital testing centers.
Gilman, what is the outlook for foreign small company stocks?
G. Gunn: Our investment style is to concentrate on searching for attractive
stocks, rather than broad, top-down economic analysis. We expect we will
continue to find small companies doing excellent jobs in filling their market
niches and continue to focus on companies in the service industries with high
returns on equity. We think many fine companies have the potential to do well.
Gary, what is the outlook for small company stocks in the United States?
G. Craven: The outlook is the best it has been for some time. For the last two
years, we have been saying that small company stocks were very cheap and patient
investors would be rewarded. Now, the recent strong performance in the sector
has acted as a catalyst. As small-caps outpace large-cap stocks, the flow of
money from large-cap stocks into small-cap stocks can provide extremely rapid
price appreciation. This trend has occurred before, and it often has evolved
into a multi-year process.
Outside of technology, valuations of small-cap stocks are extremely attractive.
Within technology, growth prospects are increasing as new technologies create
opportunities. We believe that in the next year, the leading growth
opportunities will arise from the development of the wireless communications
industry and the development of fiber-optic transmissions.
14
<PAGE>
EVERGREEN
International Growth Fund
Fund at a Glance as of October 31, 1999
"During the year, we increased our emphasis in the telecommunications industry
to take advantage of expanding opportunities, while reducing our emphasis on
defensive sectors such as food and beverages.
Portfolio
Management
------------
[PHOTO OF GILMAN GUNN]
Gilman Gunn
Tenure: January 1991
CURRENT INVESTMENT STYLE1
[STYLE BOX]
Morningstar's Style Box is based on a portfolio date as of 10/31/1999.
The Equity Style Box placement is based on a fund's price-to-earnings and price-
to-book ratio relative to the S&P 500, as well as the size of the companies in
which it invests, or median market capitalization.
1 Source: 1999 Morningstar, Inc.
2 Past performance is no guarantee of future results. The performance of each
class may vary based on differences in loads, fees and expenses paid by the
shareholders investing in each class. The investment return and principal value
will fluctuate so that an investor's shares, when redeemed, may be worth more or
less than original cost.
Historical performance shown for Classes A, C and Y prior to their inception is
based on the performance of Class B, the original class offered. These
historical returns for Classes A and Y have been adjusted to eliminate the
effect of the higher 12b-1 fees applicable to Class B. The 12b-1 fees for Class
A are 0.25%, for Class B are 1.00%, and for Class C are 1.00%. Class Y does not
pay a 12b-1 fee. If these fees had not been eliminated, returns would have been
lower.
International investing involves increased risk and volatility.
- --------------------------------------------------------------------------------
"Performance and Returns2
- --------------------------------------------------------------------------------
Portfolio Inception Date: 9/6/1979 Class A Class B Class C Class Y
Class Inception Date 1/20/1998 9/6/1979 3/6/1998 3/9/1998
Average Annual Returns*
1 year with sales charge 11.22% 11.02% 15.02% n/a
1 year w/o sales charge 16.73% 16.02% 16.02% 17.18%
3 years 12.59% 12.86% 13.64% 14.57%
5 years 10.32% 10.36% 10.62% 11.61%
10 years 7.89% 7.55% 7.54% 8.66%
Since Portfolio Inception 11.15% 10.74% 10.62% 11.63%
Maximum Sales Charge 4.75% 5.00% 1.00% n/a
Front End CDSC CDSC
*Adjusted for maximum applicable sales charge unless noted.
- --------------------------------------------------------------------------------
LONG TERM GROWTH
- --------------------------------------------------------------------------------
[LINE GRAPH]
MSCI EAFE Evergreen International
CPI Index Growth B
10/31/89 10,000 10,000 10,000
10/31/90 10,629 8,745 8,567
10/31/91 10,939 9,384 9,118
10/31/92 11,290 8,173 9,436
10/31/93 11,600 11,269 11,710
10/31/94 11,903 12,439 12,495
10/31/95 12,237 12,431 12,769
10/31/96 12,604 13,773 14,106
10/31/97 12,866 14,451 16,320
10/31/98 13,057 15,889 17,845
10/31/99 13,432 19,602 20,703
Comparison of a $10,000 investment in Evergreen International Growth Fund, Class
B shares2, versus a similar investment in the Morgan Stanley Capital
International Europe, Australasia, and Far East Index (MSCI EAFE) and the
Consumer Price Index (CPI).
The MSCI EAFE is an unmanaged market index which does not include transaction
costs associated with buying and selling securities nor any management fees. The
CPI is a commonly used measure of inflation and does not represent an investment
return. It is not possible to invest directly in an index.
15
<PAGE>
EVERGREEN
International Growth Fund
Portfolio Manager Interview
How did the Fund perform?
The Evergreen International Growth Fund Class B shares had a total return of
16.02% for the twelve-month period ended October 31, 1999. During the same
period, the Morgan Stanley Capital International Europe, Australasia and Far
East Index (MSCI EAFE), a commonly used benchmark for foreign stock performance,
had a return of 23.03%. The median return of funds in the international category
was 24.19%, according to Lipper Inc., an independent monitor of mutual fund
performance. Fund performance figures are before deduction of any applicable
sales charges.
Portfolio
Characteristics
---------------
(as of 10/31/1999)
Total Net Assets $699,457,498
Number of Holdings 180
What was the investment environment like during the period?
Markets outside the United States showed steadily increasing signs of stability.
The most notable progress was seen in Japan, which came out of a nine-year,
deflationary economic recession. Emerging markets, which suffered severe
setbacks in 1996, 1997 and 1998, also showed more progress as a result of new,
stable fiscal and monetary policies. Meanwhile, the European economic recovery
continued and a new, common currency--the euro--was introduced for 11 European
countries. In the background, the United States economy continued to act as the
engine for world economic growth.
Top 5 Industries
----------------
(as a percentage of 10/31/1999 net assets)
Banking 11.0%
Telecommunications 10.3%
Health & Personal Care 7.8%
Energy Sources 6.2%
Technology 5.2%
What were your principal strategies during the year?
At the start of the fiscal year, in November 1998, we were nearing the
conclusion of a five-year period of uncertainty and volatility in international
markets. During those five years, we had kept the Fund defensively positioned,
particularly relative to Japan and emerging markets. This conservative strategy
had enabled the Fund to outperform relevant benchmarks such as the EAFE Index
and the Lipper group of international mutual funds while experiencing less
volatility than the benchmarks. In the recent twelve-month period, however, the
Fund's underweighted positions in Japan and the emerging markets held back
performance, as these markets posted some of the strongest gains in foreign
markets. Japan's stock market, for example, rose 52% while Mexico rose 59%.
Early in this fiscal year, we were still concerned about stability in Japan and
the emerging markets, and we delayed raising our investments there until we saw
further evidence of economic progress. Over the course of the year, we saw the
evidence and gradually raised our position in Japan from 9% of net assets at the
beginning of the fiscal year to 23% at the end. At the same time, we raised our
weighting in emerging markets from 1% to 7% of net assets. This gradual shift in
weightings, however, came at a cost in performance, as the Fund did not fully
participate in the strong gains posted in Japan and the emerging markets during
the twelve-month period.
16
<PAGE>
EVERGREEN
International Growth Fund
Portfolio Manager Interview
In managing the Fund's exposure to foreign currencies, we kept about half the
assets hedged during the first four months of the year. Later, we gradually
reduced the hedged positions as we began to believe that other currencies were
likely to outperform the U.S. dollar in the shorter term. The 50% hedged
position early in the year helped performance somewhat as the euro declined in
value against the dollar; however, performance would have been even better had
the euro position been 100% hedged back into the U.S. dollar.
During the year, we increased our emphasis in the telecommunications industry to
take advantage of expanding opportunities, while reducing our emphasis on
defensive sectors such as food and beverages. At the end of the fiscal year, the
telecommunications industry accounted for 10% of net assets, while food and
household products accounted for 3%.
Top 10 Countries
----------------
(as a percentage of 10/31/1999 net assets)
Japan 23.0%
United Kingdom 17.7%
France 9.7%
Germany 8.0%
United States 7.2%
Italy 5.6%
Netherlands 4.9%
Switzerland 4.7%
Finland 3.9%
Australia 2.7%
What type of investments contributed to Fund performance?
Investments in technology and telecommunications stocks provided the best
performance during the year. European telecommunications companies, in general,
did particularly well. Nokia, the Finland-based company, the world's leading
wireless handset manufacturer, was among the performance leaders. Another
outstanding telecommunications-related performer was Matsushita Communications,
a similar company based in Japan.
During the year, we also increased our weighting in natural resources companies,
and as a group they tended to perform very well.
Top 10 Holdings
---------------
(as a percentage of 10/31/1999 net assets)
Nokia AB Oyj 2.6%
Nippon Telegraph & Telephone Corp. 2.1%
Matsushita Communication Industries Co. Ltd. 1.8%
BP Amoco 1.8%
ENI SpA 1.7%
AXA-UAP 1.6%
HSBC Holdings Plc (Hong Kong exchange) 1.6%
Mondadori Edit SpA 1.5%
Vodafone Group Plc 1.5%
National Australia Bank Ltd. 1.5%
What is your outlook for international investing?
For several years, international investments have trailed U.S. stock investments
in performance. However, we believe several factors will change this trend.
The first factor is valuations. Stock prices for international companies are
cheaper than prices for U.S. companies, based on commonly used valuation ratios.
We believe that eventually investors will look at alternatives outside the U.S.
because the domestic stocks have become so expensive.
The second factor is increased exports. Over the next two years, we believe
European stocks will benefit from the cheap euro, which will help European
companies to increase their exports at the expense of products from the U.S.
17
c
<PAGE>
EVERGREEN
International Growth Fund
Portfolio Manager Interview
Currency is another factor. The U.S. dollar could decline even further, in
relation to foreign currencies, as a result of the high current account deficit,
which now is about 4% of gross domestic product.
The fourth contributing factor is cyclical trends. The U.S. is at a later stage
in the economic cycle than either Europe or Japan, both of which have more
unused capacity for business expansion. This augurs for stronger economic growth
in Europe and an improving economy, from a low base, in Japan. These trends
should support European and Japanese equity markets.
Finally, we think restructuring will have an impact on the performance of
international investments. More merger-and-acquisition and restructuring
activity is taking place in both Europe and Japan than ever before. While
restructuring in U.S. industry tends to be about four years ahead of non-U.S.
enterprises, foreign corporations have much more opportunity to reduce costs and
increase their returns on equity. In the U.S., restructuring gains have largely
been accomplished and are reflected in stock valuations.
Taken together, these trends will likely increase the potential for foreign
markets to finally start outperforming the U.S. equity market.
18
<PAGE>
EVERGREEN
Latin America Fund
Fund at a Glance as of October 31, 1999
"Investors grew more confident about Latin America's economic health and the
viability of the region's financial markets during the year, although volatility
continued."
Portfolio Management
------------------------
[PHOTO OF FRANCIS CLARO] [PHOTO OF ANTONIO DOCAL]
Francis Claro Antonio Docal
Tenure: October 1996 Tenure: October 1996
- --------------------------------------------------------------------------------
CURRENT INVESTMENT STYLE1
- --------------------------------------------------------------------------------
[STYLE BOX]
Morningstar's Style Box is based on a portfolio date as of 10/31/1999.
The Equity Style Box placement is based on a fund's price-to-earnings and price-
to-book ratio relative to the S&P 500, as well as the size of the companies in
which it invests, or median market capitalization.
1 Source: 1999 Morningstar, Inc.
2 Past performance is no guarantee of future results. The performance of each
class may vary based on differences in loads, fees and expenses paid by the
shareholders investing in each class. The investment return and principal value
will fluctuate so that an investor's shares, when redeemed, may be worth more or
less than original cost.
Historical performance shown for Class Y prior to its inception is based on the
performance of Class A, one of the original classes offered along with Classes B
and C. The historical returns for Class Y include the effect of the 0.25% 12b-1
fee applicable to Class A. Class Y does not pay a 12b-1 fee. If these fees had
not been reflected, returns for Class Y would have been higher. Classes B and C
each pay a 12b-1 fee of 1.00%.
International investing involves increased risk and volatility.
- --------------------------------------------------------------------------------
Performance and Returns2
- --------------------------------------------------------------------------------
Portfolio Inception Date: 11/1/1993 Class A Class B Class C Class Y
Class Inception Date 11/1/1993 11/1/1993 11/1/1993 3/30/1998
Average Annual Returns*
1 year with sales charge 5.54% 4.95% 9.11% n/a
1 year w/o sales charge 10.85% 9.95% 10.11% 11.08%
3 years -2.88% -2.73% -2.03% -1.12%
5 years 0.66% 0.64% 0.89% 1.75%
Since Portfolio Inception 1.73% 1.72% 1.82% 2.64%
Maximum Sales Charge 4.75% 5.00% 1.00% n/a
Front End CDSC CDSC
* Adjusted for maximum applicable sales charge unless noted.
- --------------------------------------------------------------------------------
LONG TERM GROWTH
- --------------------------------------------------------------------------------
[LINE GRAPH]
CPI MSCI World Evergreen Latin MSCI EMF
Index American Fund A Latin America
11/30/93 10,000 10,000 9,527 11,290
10/31/94 10,254 11,464 9,945 9,499
10/31/95 10,542 12,613 9,612 9,160
10/31/96 10,857 14,737 11,222 9,885
10/31/97 11,084 17,279 13,374 8,082
10/31/98 11,248 19,989 9,753 10,763
10/31/99 11,571 25,053 10,796 10,281
Comparison of a $10,000 investment in Evergreen Latin America Fund, Class A
shares2, versus a similar investment in the Morgan Stanley Capital International
World Index (MSCI World), Morgan Stanley Capital International Emerging Markets
Free Latin America Index (MSCI EMFLA), and the Consumer Price Index (CPI).
The MSCI World and MSCI EMFLA are unmanaged market indices which do not include
transaction costs associated with buying and selling securities nor any
management fees. The CPI is a commonly used measure of inflation and does not
represent an investment return. It is not possible to invest directly in an
index.
19
<PAGE>
EVERGREEN
Latin America Fund
Portfolio Manager Interview
How did the Fund perform?
For the twelve-month period ended October 31, 1999, the Evergreen Latin America
Fund's Class A shares had a total return of 10.85%. During the same period, the
MSCI EMFLA Index had a return of 21.17%. The median return of mutual funds in
the Latin America fund category was 14.00%, according to Lipper Inc., an
independent monitor of mutual fund performance. Fund returns are before
deduction of any applicable sales charges.
Portfolio
Characteristics
---------------
(as of 10/31/1999)
Total Net Assets $29,592,222
Number of Holdings 62
How would you describe the investment environment in Latin America during the
twelve-month period?
Investors grew more confident about Latin America's economic health and the
viability of the region's financial markets during the year, although volatility
or rapid fluctuations in prices--continued. The twelve-month period encompassed
two very strong rallies, the first during the first four months of 1999, the
second during the final three weeks of the period in October. In between, a long
correction during the summer months took away most of the earlier gains.
As a whole, the twelve-month period was a time of substantial recovery and
increasing confidence in Latin America. The fiscal year began in November 1998
with stock valuations near their low points in the wake of the emerging market
crises of 1997 and 1998. By the end of the year, the worst fears had been put to
rest and international financial institutions were showing their willingness to
invest in the growth of emerging markets, in general, and Latin America, in
particular.
Geographical Allocation
-----------------------
(as a percentage of 10/31/1999 net assets)
Mexico 41.8%
Brazil 38.2%
Chile 6.9%
Argentina 6.9%
United States 3.0%
Peru 1.9%
Venezuela 1.4%
What factors contributed to this turnaround in sentiment?
First, there was a growing belief that the global economy was healing. The
United States appeared to be heading to a "soft landing" of moderate economic
growth after a period in which investors worried that excessive growth would
lead to inflation and then to recession.
Meanwhile, economic growth in Europe was accelerating, while Japan began to
climb out of its prolonged recession. Emerging markets finally began to pull out
of recession and to recover from the currency devaluations of 1997 and 1998. The
emerging nations were helped by the strong support of the International Monetary
Fund (IMF) and the world's industrialized economies. All these factors together
worked to stabilize emerging market economies, which began to grow again in
1999.
Second, commodity prices increased. The price of a barrel of oil, for example,
doubled, while the prices of copper and other metals also rose. Mexico,
Venezuela and Argentina are oil exporters and are helped by high
20
<PAGE>
EVERGREEN
Latin America Fund
Portfolio Manager Interview
oil prices. The economies of Peru and Chile benefited by the higher prices of
copper, gold and silver. Brazil's economy also is dependent on the prices of
metals, although less so than other Latin American nations.
Third, Gross Domestic Product (GDP) accelerated. The region's GDP rose from a
1.1% rate in 1998 and we believe may continue to rise towards an anticipated
rate of more than 4% in 2000.
Fourth, corporate earnings rose. Profits were driven by the revenue growth that
accompanies faster economic growth. After the economic crisis of 1997 and 1998,
many manufacturing, mining and retailing companies in emerging markets had
excess capacity, which meant they could experience substantial increases in
business revenues without being required to make major capital investments. The
result was higher earnings.
Fifth, stock valuations were attractive. Not only did stock prices appear cheap
in relation to the valuations in developed economies, but they also appeared
attractive in relation to historical patterns in Latin America.
Finally, money flows increased in the region. International investment
institutions allocated more money to Latin America. After witnessing strong
rallies in emerging markets throughout the world, institutions began to include
emerging markets as well as developed markets as part of their normal
allocations.
Can you explain the continuing volatility in the region?
While these factors all contributed to the strengthened environment for Latin
American investing, market volatility did not disappear. After experiencing
sharp rises during the first five months of 1999, the equity markets lost most
of those gains during the summer before reviving again in mid-October. Concerns
about the influence of the U.S. economy tended to dominate the thinking of many
investors. As the U.S. Federal Reserve Board began raising short-term interest
rates to thwart any inflationary pressures, investors worried that higher rates
could reduce market liquidity and choke off the flow of capital to Latin
America. Moreover, they were concerned that a major correction in the U.S. stock
market could spread to Latin American markets. By the end of the twelve-month
period, however, it appeared that the U.S. Federal Reserve would limit its rate
increases to three and that the U.S. economy would have a "soft landing" without
falling into recession.
Top 5 Industries
----------------
(as a percentage of 10/31/1999 net assets)
Telecommunications 29.5%
Beverages & Tobacco 9.9%
Banking 8.0%
Energy Sources 6.5%
Merchandising 6.4%
What were your principal investment strategies?
We continued to look for companies that had records of consistent earnings
growth with prospects for continued expansion. We sought stocks which we
believed were trading at reasonable valuations. We found many attractive
targets, especially in the two largest economies: Brazil and Mexico. After the
Asian economic crisis of 1997 and 1998, the stocks of many Latin American
blue-chip companies were trading at very cheap prices.
While we started the fiscal year in November 1998 with a very high cash position
of about 40% of net assets, we kept the Fund fully invested for most of the
year, with the highest concentrations in large, market-leading companies in
Brazil and Mexico. Because
21
<PAGE>
EVERGREEN
Latin America Fund
Portfolio Manager Interview
these stocks were the most liquid, or easily tradable, it made sense that they
would be the first to benefit from the resurgence of investor confidence. At the
start of a rally, money flows first to the most recognizable companies in the
most developed financial markets.
At the end of the fiscal year, on October 31, 1999, 80% of the Fund's assets
were invested in either Brazil or Mexico.
What were some of the investments that illustrated this strategy?
Good examples are the Fund's two largest holdings: Embraer and Telmex.
Embraer, a Brazilian company, has become one of the world's dominant regional
jet aircraft manufacturers. In fact, it has gained a majority of the market
share of the planes that are replacing turbo-prop aircraft used for commuter and
other short-flight commercial routes. Their planes have earned a reputation for
efficiency and low cost and they currently have a backlog of $18 billion in
orders from companies such as American Airlines, Continental Airlines, British
Airways, Swissair and other blue chip corporations.
Embraer recently signed partnership agreements with a consortium of French
defense contractors and likely will begin manufacturing the Mirage jet fighters
for air forces around the world. The agreement marks Embraer's renewed strength
in the military as well as the commercial aviation market.
Telefonos de Mexico, or Telmex, is Mexico's largest telephone company, with
dominant market positions in both the fixed-wire and wireless markets.
Telmex has aggressively defended its market share in its traditional telephone
business, even as utility deregulation has come to Mexico, while increasing its
share in the rapidly expanding wireless business. Moreover, it has launched a
new, fixed, wireless business that enables it to extend telephone service to
regions where the costs of traditional wire service would be prohibitive. Telmex
also has entered into alliances with major international technology companies to
invest in internet operations in Latin America.
Telmex also has maintained an aggressive stock-buyback program, which has helped
support the price of its stock, which rose 80% during the Fund's fiscal year. In
the future, Telmex is exploring the possibility of joining a global
telecommunications consortium.
Top 10 Holdings
---------------
(as a percentage of 10/31/1999 net assets)
Telefonos de Mexico SA ADR 9.9%
Embraer-Empresa Brasileira de Aeronautica SA 6.3%
Tele Norte Leste Participacoes SA ADR 5.1%
Centrais Eletricas Brasileiras SA, ADR 4.1%
Petroleo Brasileiro SA, ADR ("Petrobras") 4.1%
Grupo Televisa SA ADR 3.2%
Cifra SA de CV, Ser. V 2.9%
Tele Centro Sul Participacoes SA, ADR 2.7%
Cemex SA de CV, Ser. B, ADR 2.7%
Grupo Carso SA de CV, Ser. A1 2.7%
22
<PAGE>
EVERGREEN
Latin America Fund
Portfolio Manager Interview
What is your outlook for investing in Latin America?
We are generally very positive because of the expanding economic growth and
still-low stock valuations in the region. We should point out that investor
confidence remains fragile, and we expect short-term volatility to continue in
Latin American equity markets.
The favorable factors that contributed to increased investor confidence and
strong performance during the past year are continuing. Moreover, the U.S.
economy continues to be healthy, which has an important influence on the
economies of Latin America. Many Latin American companies, particularly in
Mexico, are prime beneficiaries of the trend for U.S. corporations to outsource
production operations.
In general, we are more optimistic than we have been in several years.
23
<PAGE>
EVERGREEN
Perpetual International Fund
(formerly Mentor Perpetual International Portfolio)
Fund at a Glance as of October 31, 1999
"In looking at the big picture, we believe the single most important influence
on the performance of international markets relative to the US over the next
year will be further recovery in Japan."
Portfolio
Management
Kathryn Langridge Scott McGlashan
Tenure: May 1996 Tenure: May 1996
Margaret Rodden Stephen Whittaker
Tenure: May 1996 Tenure: May 1996
- --------------------------------------------------------------------------------
CURRENT INVESTMENT STYLE/1/
- --------------------------------------------------------------------------------
[STYLE BOX]
Morningstar's Style Box is based on a portfolio date as of 10/31/1999.
The Equity Style Box placement is based on a fund's price-to-earnings and price-
to-book ratio relative to the S&P 500, as well as the size of the companies in
which it invests, or median market capitalization.
/1/ Source: 1999 Morningstar, Inc.
/2/ Past performance is no guarantee of future results. The performance of each
class may vary based on differences in loads, fees and expenses paid by the
shareholders investing in each class. The investment return and principal value
will fluctuate so that an investor's shares, when redeemed, may be worth more or
less than original cost.
Historical performance shown for Classes A, B and C prior to their inception is
based on the performance of Class Y, the original class offered. These
historical returns for Classes A, B and C have not been adjusted to reflect the
effect of the Class' 12b-1 fees. These fees for Class A are 0.25%, for Class B
are 1.00% and for Class C are 1.00%. Class Y does not pay a 12b-1 fee. If these
fees had been reflected, returns would have been lower.
International investing involves increased risk and volatility.
- --------------------------------------------------------------------------------
Performance and Returns/2/
- --------------------------------------------------------------------------------
Portfolio Inception Date: 5/29/1996 Class A Class B Class C Class Y
Class Inception Date 12/27/1996 10/18/1999 12/27/1996 5/29/1996
Average Annual Returns*
1 year with sales charge 19.70% 20.85% 23.72% n/a
1 year w/o sales charge 25.67% 25.85% 24.72% 25.92%
3 years 13.80% 15.22% 15.02% 15.98%
Since Portfolio Inception 10.98% 12.17% 12.03% 12.85%
Maximum Sales Charge 4.75% 5.00% 1.00% n/a
Front End CDSC CDSC
* Adjusted for maximum applicable sales charge unless noted.
- --------------------------------------------------------------------------------
LONG TERM GROWTH
- --------------------------------------------------------------------------------
[LINE GRAPH]
CPI MSCI EAFE Class A
12/31/96 10,000 10,000 9,391
10/31/97 10,189 10,217 10,275
10/31/98 10,340 11,234 11,038
10/31/99 10,637 13,859 13,871
Comparison of a $10,000 investment in Evergreen Perpetual International Fund,
Class A shares/2/, versus a similar investment in the Morgan Stanley Capital
International Europe, Australasia, and Far East Index (MSCI EAFE) and the
Consumer Price Index (CPI).
The MSCI EAFE is an unmanaged market index which does not include transaction
costs associated with buying and selling securities nor any management fees. The
CPI is a commonly used measure of inflation and does not represent an investment
return. It is not possible to invest directly in an index.
24
<PAGE>
EVERGREEN
Perpetual International Fund
(formerly Mentor Perpetual International Portfolio)
Portfolio Manager Interview
How did the Fund perform?
An asset allocation approach, based on moving assets out of European markets and
into Japan and other Asian markets, led to excellent performance during the
twelve months. For the twelve-month period ended October 31, 1999, the Fund's
Class A shares returned 25.67%. The Fund outperformed the 23.03% return of its
benchmark, the MSCI EAFE Index, while the median return of the funds in the
international category was 24.19%, as tracked by Lipper, Inc., an independent
monitor of mutual fund performance. Fund returns are before deduction of any
applicable sales charges.
Portfolio
Characteristics
---------------
(as of 10/31/1999)
Total Net Assets $160,941,959
Number of Holdings 291
What were the principal strategies that supported the Fund's performance?
Early in the period, we began increasing the Fund's commitment to Asia. As a
result, by the end of the twelve months, assets in Japan accounted for 26% of
the portfolio up from 13% at the beginning of the period, becoming the largest
individual country weighting in the portfolio and also the most important
contributor to performance. Japan has been in a recession for nine years;
however, in the last quarter of 1998, two conditions prevailed increasing its
attractiveness. First, investor sentiment was so negative that stocks were
extremely cheap; and second, fiscal, monetary and business reforms were being
put in place to address Japan's economic problems. These included changes in
banking and interest-rate policy, large public works expenditures, an infusion
of capital investment into the banks, and an unprecedented level of corporate
restructuring. There was also a large amount of merger and acquisition activity.
A recent high profile example of such activity was the merger of Fuji Bank, Dai
Ichi-Kangyo Bank and Industrial Bank of Japan, which created the largest banking
corporation in the world.
Top 5 Industries
----------------
(as a percentage of 10/31/1999 net assets)
Banking 11.4%
Chemicals 6.7%
Electrical &Electronics 6.2%
Food &Household Products 6.2%
Telecommunications 4.6%
Portfolio assets in other parts of Asia increased from 5% to 10%. What was
attractive about the region?
For more than a year, Asia had been in turmoil. High levels of corporate and
government debt, weak currencies, high interest rates and political instability
had eroded investor confidence in the region. As a result, Asian stock markets
declined precipitously. In the fourth quarter of 1998, the economic outlook for
Asia began to brighten. Central banks began injecting huge amounts of liquidity
into the economy by systematically lowering interest rates. Lower interest rates
led to business expansion and corporate restructuring. During this time, Asian
stocks were selling at extremely low prices, and we began selectively adding
them to the portfolio. We concentrated investments in Hong Kong and Singapore,
where we invested primarily in financial stocks. Most recently, consumer demand
for goods and services has picked up in Asia. We believe this should lead to
significant earnings recovery in the months ahead.
25
<PAGE>
EVERGREEN
Perpetual International Fund
(formerly Mentor Perpetual International Portfolio)
Portfolio Manager Interview
Top 10 Countries
----------------
(as a percentage of 10/31/1999 net assets)
Japan 25.6%
United Kingdom 18.8%
Germany 10.7%
France 9.4%
Finland 4.9%
Netherlands 4.5%
Hong Kong 3.9%
United States 3.0%
Spain 3.0%
Sweden 2.8%
How did the European stocks in the portfolio perform?
Slower economic growth and overstated benefits of the euro, Europe's single
currency, restrained European markets over the past year and, in general, stocks
in this region produced lackluster performance. Several months ago, we began
seeing signs of a cyclical recovery in European economies, and we have
positioned the portfolio to take advantage of this situation. As a result, we
emphasized industrial cyclicals, such as oils, steel, paper and pulp, chemicals
and engineering stocks. While we reduced the Fund's exposure to Europe from 60%
to 45% of assets, we continue to find opportunities in individual stocks, as
recovery from recession begins. France is the Fund's biggest country weighting
in this region, followed by Germany and Spain.
At 18% of assets, exposure to the United Kingdom (UK) remained constant. In
1998, the Fund suffered from our reluctance to hold on to what we believed were
overvalued telecommunications and pharmaceutical stocks. In 1999, however, there
has been a rotation in the UK market away from those mega-cap stocks to small
and mid-cap stocks, like the ones we hold in the portfolio. Our "growth at a
reasonable price" stock-picking style has paid off. In the UK we favored
investments in banks, aerospace, and consumer cyclicals.
Top 10 Holdings
---------------
(as a percentage of 10/31/1999 net assets)
Sumitomo Trust & Banking Co. Ltd. 2.2%
Funai Electric Co. Ltd. 2.1%
Total Fina SA Cl. B 1.9%
Okumura Corp. 1.9%
Kyocera Corp. 1.8%
Nokia AB Oyj 1.8%
Ericsson LM Telephone, Ser B. 1.6%
Asahi Glass Co. Ltd. 1.6%
Bank Of Tokyo-Mitsubishi Ltd. 1.5%
Oji Paper Co. Ltd. 1.5%
26
<PAGE>
EVERGREEN
Perpetual International Fund
(formerly Mentor Perpetual International Portfolio)
Portfolio Manager Interview
Did you make any changes in the Latin American portion of the portfolio?
Exposure to Latin America remained constant at 1%
of assets and that was invested in Mexico and Brazil. While some Latin American
markets rose during the period, they continued to be plagued by currency
weakness. We expect currency problems to persist for some time in this region.
What is your outlook?
Our outlook is dominated by our perspective on Japan. We expect there will be
further monetary easing in Japan and that will, in due course, be accompanied by
weakness in the yen. We view this as a positive situation, because the current
level of the yen threatens to stifle the still fragile economic recovery. In
looking at the big picture, we believe the single most important influence on
the performance of international markets relative to the U.S. over the next year
will be further recovery in Japan. Japan's economic turnaround should result in
greater demand for goods and services produced in other Asian markets, which
will diminish Asia's reliance on the U.S. as a market for its goods and
services.
27
<PAGE>
EVERGREEN
Precious Metals Fund
Fund at a Glance as of October 31, 1999
"The supply side of the gold equation has finally shifted in favor of investors.
Demand for gold remains strong, and we believe the price of gold should rise
gradually."
Portfolio Management
--------------------
[PHOTO OF JOHN MADDEN]
John Madden
Tenure: October 1995
- --------------------------------------------------------------------------------
CURRENT INVESTMENT STYLE1
- --------------------------------------------------------------------------------
[STYLE BOX]
Morningstar's Style Box is based on a portfolio date as of 10/31/1999.
The Equity Style Box placement is based on a fund's price-to-earnings and price-
to-book ratio relative to the S&P 500, as well as the size of the companies in
which it invests, or median market capitalization.
1 Source: 1999 Morningstar, Inc.
2 Past performance is no guarantee of future results. The performance of each
class may vary based on differences in loads, fees and expenses paid by the
shareholders investing in each class. The investment return and principal value
will fluctuate so that an investor's shares, when redeemed, may be worth more or
less than original cost.
Historical performance shown for Classes A and C prior to their inception is
based on the performance of Class B, the original class offered. The historical
returns for Class A have been adjusted to eliminate the effect of the higher
12b-1 fees applicable to Class B. The 12b-1 fees for Class A are 0.25%, for
Class B are 1.00%, and for Class C are 1.00%. If these fees had not been
eliminated, returns would have been lower.
International investing involves increased risk and volatility.
- --------------------------------------------------------------------------------
Performance and Returns2
- --------------------------------------------------------------------------------
Portfolio Inception Date: 1/30/1978 Class A Class B Class C
Class Inception Date 1/20/1998 1/30/1978 1/29/1998
Average Annual Returns*
1 year with sales charge -2.78% -3.79% 0.12%
1 year w/o sales charge 2.06% 1.21% 1.12%
3 years -19.47% -19.50% -18.78%
5 years -12.97% -13.09% -12.78%
10 years -2.20% -2.52% -2.53%
Since Portfolio Inception 6.88% 6.49% 6.43%
Maximum Sales Charge 4.75% 5.00% 1.00%
Front End CDSC CDSC
* Adjusted for maximum applicable sales charge unless noted.
- --------------------------------------------------------------------------------
LONG TERM GROWTH
- --------------------------------------------------------------------------------
[LINE GRAPH]
Evergreen Precious
CPI S & P 500 Metals B LGFI
10/31/89 10,000 10,000 10,000 10,000
10/31/90 10,629 8,932 8,333 8,425
10/31/91 10,939 11,530 9,275 10,574
10/31/92 11,290 12,301 8,222 9,523
10/31/93 11,600 13,745 13,753 11,952
10/31/94 11,903 13,878 15,340 8,840
10/31/95 12,237 17,085 12,466 8,674
10/31/96 12,604 20,721 14,448 10,019
10/31/97 12,866 26,872 9,890 8,089
10/31/98 13,057 32,280 7,655 10,157
10/31/99 13,432 40,044 7,748 8,454
Comparison of a $10,000 investment in Evergreen Precious Metals Fund, Class B
shares2, versus a similar investment in the Standard & Poor's 500 Index (S&P
500), the Lipper Gold Fund Index (LGFI) and the Consumer Price Index (CPI).
The S&P 500 and the LGFI are unmanaged market indices which do not include
transaction costs associated with buying and selling securities nor any
management fees. The CPI is a commonly used measure of inflation and does not
represent an investment return. It is not possible to invest directly in an
index.
28
<PAGE>
EVERGREEN
Precious Metals Fund
Portfolio Manager Interview
How did the Fund perform?
For the twelve-month period ended October 31, 1999, the Evergreen Precious
Metals Fund Class B shares returned 1.21%. For the same twelve-month period, the
Lipper Gold Fund Index rose 1.55% and the Standard & Poor's 500 Index rose
25.67%. Fund returns are before deduction of any applicable sales charges.
Portfolio
Characteristics
---------------
(as of 10/31/1999)
Total Net Assets $83,632,792
Number of Holdings 45
Describe the investment environment for precious metals stocks over the past
year.
Over the past year, gold was increasingly volatile, with generally weak prices
punctuated by two rallies. The pattern was governed largely by two major moves
of central banks, one a short-term negative and one, we believe, a long-term
positive. From November 1998 through March 1999, the price of gold drifted down.
In April, sparked by strong gains in metal and oil prices, gold began to show
some life. The rally was cut short, however, when the Bank of England announced
that it planned to sell a portion of its gold holdings at a series of public
auctions. This news sent the price of gold down sharply. Gold reached a 20-year
low of $252.55 an ounce in late August. Throughout the summer, there were
debates in Britain, the U.S. Congress, the International Monetary Fund (IMF) and
in world banking circles regarding what the role of gold should be.
The question was answered in September 1999, when 15 European central banks
agreed to cap future gold sales and, more importantly, limit the amount of gold
available for lending. This agreement reassured markets that gold remains a
major element of monetary reserves and reduced the influence of short sellers
and damage to emerging economies. This positive development, and the short
covering it engendered, drove gold prices up to over $325 in a matter of days.
Gold stocks followed suit. This burst of enthusiasm was short-lived, however,
the announce-ment by the central banks was too successful. Higher gold prices
caught a number of producers and traders with vulnerable hedge books, and in
some cases it became not just a matter of opportunity cost but of corporate
survival. Liquidity found its way into the system, and the price of gold
retreated to below $300 by the end of October. Stock prices also declined.
How did you manage the Fund in this environment?
Because weak gold prices prevailed, our investment strategy was somewhat
defensive for much of the year. We maintained significant holdings of non-gold
investments, such as platinum and diamonds. We held relatively unleveraged
stocks, such as Franco-Nevada, Barrick Gold and Anglo Gold. As prices
strengthened, we modified this position and added to holdings, such as Newmont
and Homestake. This move increased our exposure to better gold prices. We added
to Harmony Gold and Gold Fields, two South African holdings, and we established
a position in Battle Mountain, a U.S.-based company that has been out of favor
but is showing signs of an operating turn-around.
Industry Allocation
-------------------
(as a percentage of 10/31/1999 net assets)
Gold Mining 55.5%
Metals & Mining 41.0%
Cash and Cash Equivalents 3.5%
29
<PAGE>
EVERGREEN
Precious Metals Fund
Portfolio Manager Interview
Did you make changes to the Fund's geographic allocation?
The primary shift in the geographic mix of the portfolio was an increase in
South African holdings from 29% to 35%, with a corresponding drop in North
American holdings. The Fund's exposure to South Africa is at its highest level
in several years. Six of the Fund's top 10 holdings are in that country. This
geographic shift represents relative performance as well as purchases.
Geographical Allocation
-----------------------
(as a percentage of 10/31/1999 net assets)
Canada 38.1%
South Africa 35.2%
United States 13.8%
Australia 9.4%
Papua New Guinea 0.8%
What stocks most affected performance?
The platinum-palladium stocks are an example of both strong performance and
disappointment. Based upon excellent demand, improving operations and rising
prices, our major holdings in this industry performed very well. Amplats doubled
in value, and Impala Platinum rose threefold. Harmony Gold in South Africa is
another success story. Harmony has carved out a niche for itself. Its aim is to
profitably operate properties that others have considered marginal. Other South
African companies are beginning to emulate Harmony's strategy of restructuring
management and reducing costs. Harmony's stock performed especially well when
gold rallied, and it has maintained its gains.
Stillwater was a different story. This U.S. platinum-palladium producer had a
fine year in 1998. The stock performed well until last summer, when a series of
unexpected operating disappointments caused a sharp correction. We reduced
holdings of Stillwater and are monitoring it to see if recent operating and
management changes can put the company back on track.
Top 10 Holdings
---------------
(as a percentage of 10/31/1999 net assets)
Franco Nevada Mining Ltd. 13.7%
Harmony Gold Mining Ltd. 6.7%
AngloGold Ltd. 5.5%
Meridian Gold, Inc. 5.1%
Gencor Ltd. 4.4%
Impala Platinum Holdings Ltd. 4.4%
Goldfields Ltd. 4.3%
Stillwater Mining Co. 4.1%
Anglo-American Platinum Corp. Ltd. 4.1%
Acacia Resources Ltd. 3.8%
What is your outlook?
Unfortunately, the price of gold did not stay at the high level it reached after
the September announcement of the European central banks. We believe the
authorities were not prepared for the reaction to their agreement and had to
take steps to soften its immediate impact. The actions of the central banks
should not obscure the fact that their initial decision to limit future sales
and lending was a watershed event for the gold industry. This decision removes a
major source of liquidity from gold markets, liquidity that has been
instrumental in driving down the price of the metal over the past two to three
years. The supply side of the gold equation has finally shifted in favor of
investors. Demand for gold remains strong, and we believe the price of gold
should rise gradually. Whether or not we get the final piece of the
puzzle--greater investor demand because of problems with the stock market,
inflation or the dollar--remains to be seen. In general, we view these events as
positive for gold and for the Fund.
30
<PAGE>
EVERGREEN
Emerging Markets Growth Fund
Financial Highlights
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Year Ended October 31,
-------------------------------------------- Year Ended
1999 # 1998 # 1997 # 1996 # 1995 (b) December 31, 1994 (a)
<S> <C> <C> <C> <C> <C> <C>
CLASS A SHARES
Net asset value,
beginning of period $ 7.90 $ 9.99 $ 8.46 $ 7.90 $ 8.17 $10.00
------ ------ ------ ------ ------ ------
Income from investment
operations
Net investment income
(loss) (0.01) 0.14 0 (0.01) 0.05 0
Net realized and
unrealized gains or
losses on securities
and foreign currency
related transactions 1.44 (1.98) 1.53 0.62 (0.32) (1.83)
------ ------ ------ ------ ------ ------
Total from investment
operations 1.43 (1.84) 1.53 0.61 (0.27) (1.83)
------ ------ ------ ------ ------ ------
Distributions to
shareholders from
Net investment income (0.01) 0 0 (0.05) 0 0
Net realized gains 0 (0.25) 0 0 0 0
------ ------ ------ ------ ------ ------
Total distributions to
shareholders (0.01) (0.25) 0 (0.05) 0 0
------ ------ ------ ------ ------ ------
Net asset value, end of
period $ 9.32 $ 7.90 $ 9.99 $ 8.46 $ 7.90 $ 8.17
------ ------ ------ ------ ------ ------
Total return* 18.16% (18.89%) 18.09% 7.70% (3.30%) (18.30%)
Ratios and supplemental
data
Net assets, end of
period (thousands) $8,390 $6,195 $2,777 $1,645 $1,117 $ 867
Ratios to average net
assets
Expenses** 2.16% 2.04% 1.75% 1.74% 1.73%+ 1.78%+
Net investment income (0.09%) 1.54% (0.02%) (0.09%) 0.76%+ 0.12%+
Portfolio turnover rate 205% 380% 157% 107% 65% 17%
</TABLE>
<TABLE>
<CAPTION>
Year Ended October 31,
-------------------------------------------- Year Ended
1999 # 1998 # 1997 # 1996 # 1995 (b) December 31, 1994 (a)
<S> <C> <C> <C> <C> <C> <C>
CLASS B SHARES
Net asset value,
beginning of period $ 7.69 $ 9.85 $ 8.39 $ 7.85 $ 8.16 $10.00
------ ------ ------ ------ ------ ------
Income from investment
operations
Net investment income
(loss) (0.08) 0.08 (0.08) (0.08) 0.01 (0.02)
Net realized and
unrealized gains or
losses on securities
and foreign currency
related transactions 1.41 (1.99) 1.54 0.62 (0.32) (1.82)
------ ------ ------ ------ ------ ------
Total from investment
operations 1.33 (1.91) 1.46 0.54 (0.31) (1.84)
------ ------ ------ ------ ------ ------
Distributions to
shareholders from
Net investment income (0.01) 0 0 0 0 0
Net realized gains 0 (0.25) 0 0 0 0
------ ------ ------ ------ ------ ------
Total distributions to
shareholders (0.01) (0.25) 0 0 0 0
------ ------ ------ ------ ------ ------
Net asset value, end of
period $ 9.01 $ 7.69 $ 9.85 $ 8.39 $ 7.85 $ 8.16
------ ------ ------ ------ ------ ------
Total return* 17.32% (19.89%) 17.40% 6.90% (3.80%) (18.40%)
Ratios and supplemental
data
Net assets, end of
period (thousands) $3,452 $2,970 $4,020 $2,881 $1,940 $1,589
Ratios to average net
assets
Expenses** 2.90% 2.78% 2.50% 2.50% 2.48%+ 2.53%+
Net investment income (0.97%) 0.80% (0.79%) (0.87%) 0.03%+ (0.84%)+
Portfolio turnover rate 205% 380% 157% 107% 65% 17%
</TABLE>
(a) For the period from September 6, 1994 (commencement of class operations)
to December 31, 1994.
(b) For the ten-month period ended October 31, 1995. The Fund changed its year
end from December 31 to October 31, effective October 31, 1995.
* Excluding applicable sales charges.
** Ratio of expenses to average net assets includes fee waivers and excludes
fee credits.
+ Annualized.
# Net investment income or loss is based on average shares outstanding during
the period.
See Combined Notes to Financial Statements.
31
<PAGE>
EVERGREEN
Emerging Markets Growth Fund
Financial Highlights
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Year Ended October 31,
-------------------------------------------- Year Ended
1999 # 1998 # 1997 # 1996 # 1995 (b) December 31, 1994 (a)
<S> <C> <C> <C> <C> <C> <C>
CLASS C SHARES
Net asset value,
beginning of period $ 7.68 $ 9.85 $ 8.38 $7.84 $8.16 $10.00
------ ------ ------ ----- ----- ------
Income from investment
operations
Net investment income
(loss) (0.08) 0.05 (0.06) (0.08) 0.02 (0.02)
Net realized and
unrealized gains or
losses on securities
and foreign currency
related transactions 1.43 (1.97) 1.53 0.62 (0.34) (1.82)
------ ------ ------ ----- ----- ------
Total from investment
operations 1.35 (1.92) 1.47 0.54 (0.32) (1.84)
------ ------ ------ ----- ----- ------
Distributions to
shareholders from
Net investment income (0.01) 0 0 0 0 0
Net realized gains 0 (0.25) 0 0 0 0
------ ------ ------ ----- ----- ------
Total distributions to
shareholders (0.01) (0.25) 0 0 0 0
------ ------ ------ ----- ----- ------
Net asset value, end of
period $ 9.02 $ 7.68 $ 9.85 $8.38 $7.84 $ 8.16
------ ------ ------ ----- ----- ------
Total return* 17.60% (20.00%) 17.50% 6.90% (3.90%) (18.40%)
Ratios and supplemental
data
Net assets, end of
period (thousands) $1,024 $ 577 $1,282 $ 85 $ 56 $ 89
Ratios to average net
assets
Expenses** 2.90% 2.78% 2.50% 2.51% 2.50%+ 2.53%+
Net investment income (0.96%) 0.59% (0.61%) (0.91%) 0.72%+ (0.82%)+
Portfolio turnover rate 205% 380% 157% 107% 65% 17%
</TABLE>
<TABLE>
<CAPTION>
Year Ended October 31,
--------------------------------------------- Year Ended
1999 # 1998 # 1997 # 1996 # 1995 (b) December 31, 1994 (a)
<S> <C> <C> <C> <C> <C> <C>
CLASS Y SHARES
Net asset value,
beginning of period $ 7.96 $ 10.04 $ 8.48 $ 7.92 $ 8.17 $10.00
------- ------- ------- ------- ------ ------
Income from investment
operations
Net investment income
(loss) 0 0.16 0.03 0.01 0.05 0.01
Net realized and
unrealized gains or
losses on securities
and foreign currency
related transactions 1.47 (1.98) 1.53 0.62 (0.30) (1.84)
------- ------- ------- ------- ------ ------
Total from investment
operations 1.47 (1.82) 1.56 0.63 (0.25) (1.83)
------- ------- ------- ------- ------ ------
Distributions to
shareholders from
Net investment income (0.02) (0.01) 0 (0.07) 0 0
Net realized gains 0 (0.25) 0 0 0 0
------- ------- ------- ------- ------ ------
Total distributions to
shareholders (0.02) (0.26) 0.00 (0.07) 0 0
------- ------- ------- ------- ------ ------
Net asset value, end of
period $ 9.41 $ 7.96 $ 10.04 $ 8.48 $ 7.92 $ 8.17
------- ------- ------- ------- ------ ------
Total return 18.57% (18.63%) 18.40% 7.90% (3.10%) (18.30%)
Ratios and supplemental
data
Net assets, end of
period (thousands) $52,372 $48,953 $61,142 $28,959 $9,355 $5,878
Ratios to average net
assets
Expenses** 1.91% 1.78% 1.50% 1.50% 1.48%+ 1.53%+
Net investment income 0.04% 1.71% 0.25% 0.11% 0.94%+ 0.43%+
Portfolio turnover rate 205% 380% 157% 107% 65% 17%
</TABLE>
(a) For the period from September 6, 1994 (commencement of class operations)
to December 31,1994.
(b) For the ten-month period ended October 31, 1995. The Fund changed its year
end from December 31 to October 31, effective October 31, 1995.
* Excluding applicable sales charges.
** Ratio of expenses to average net assets includes fee waivers and excludes
fee credits.
+ Annualized.
# Net investment income or loss is based on average shares outstanding during
the period.
See Combined Notes to Financial Statements.
32
<PAGE>
EVERGREEN
Global Leaders Fund
Financial Highlights
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Year Ended October 31,
------------------------------------------
1999 # 1998 # 1997 # 1996 (a) #
<S> <C> <C> <C> <C>
CLASS A SHARES
Net asset value, beginning of
period $ 14.95 $ 13.67 $ 11.91 $ 11.29
-------- -------- ------- -------
Income from investment operations
Net investment income (loss) (0.06) (0.04) (0.01) 0
Net realized and unrealized gains
on securities and foreign currency
related transactions 3.46 1.38 1.78 0.62
-------- -------- ------- -------
Total from investment operations 3.40 1.34 1.77 0.62
-------- -------- ------- -------
Distributions to shareholders from
Net realized gains 0 (0.06) (0.01) 0
-------- -------- ------- -------
Total distributions to shareholders 0 (0.06) (0.01) 0
-------- -------- ------- -------
Net asset value, end of period $ 18.35 $ 14.95 $ 13.67 $ 11.91
-------- -------- ------- -------
Total return* 22.74% 9.82% 14.88% 5.50%
Ratios and supplemental data
Net assets, end of period
(thousands) $185,806 $142,622 $38,604 $12,975
Ratios to average net assets:
Expenses** 1.79% 1.85% 1.91% 1.75%+
Interest Expense 0.13% N/A N/A N/A
Net investment income (0.37%) (0.25%) (0.05%) 0.10%+
Portfolio turnover rate 33% 16% 29% 20%
</TABLE>
<TABLE>
<CAPTION>
Year Ended October 31,
-------------------------------------------
1999 # 1998 # 1997 # 1996 (a) #
<S> <C> <C> <C> <C>
CLASS B SHARES
Net asset value, beginning of
period $ 14.70 $ 13.52 $ 11.87 $ 11.29
-------- -------- -------- -------
Income from investment operations
Net investment loss (0.19) (0.16) (0.11) (0.02)
Net realized and unrealized gains
on securities and foreign
currency related transactions 3.41 1.40 1.77 0.60
-------- -------- -------- -------
Total from investment operations 3.22 1.24 1.66 0.58
-------- -------- -------- -------
Distributions to shareholders
from
Net realized gains 0 (0.06) (0.01) 0
-------- -------- -------- -------
Total distributions to
shareholders 0 (0.06) (0.01) 0
-------- -------- -------- -------
Net asset value, end of period $ 17.92 $ 14.70 $ 13.52 $ 11.87
-------- -------- -------- -------
Total return* 21.90% 9.19% 14.01% 5.10%
Ratios and supplemental data
Net assets, end of period
(thousands) $207,433 $166,556 $134,375 $41,948
Ratios to average net assets:
Expenses** 2.58% 2.61% 2.66% 2.50%+
Interest Expense 0.14% N/A N/A N/A
Net investment income (1.16%) (1.09%) (0.83%) (0.68%)+
Portfolio turnover rate 33% 16% 29% 20%
</TABLE>
(a) For the period from June 3, 1996 (commencement of class operations) to Oc-
tober 31, 1996.
* Excluding applicable sales charges.
** Ratio of expenses to average net assets includes fee waivers and excludes
fee credits.
+ Annualized.
# Net investment income or loss is based on average shares outstanding during
the period.
See Combined Notes to Financial Statements.
33
<PAGE>
EVERGREEN
Global Leaders Fund
Financial Highlights
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Year Ended October 31,
-------------------------------------
1999 # 1998 # 1997 # 1996 (a) #
<S> <C> <C> <C> <C>
CLASS C SHARES
Net asset value, beginning of period $14.67 $13.51 $11.86 $11.29
------ ------ ------ ------
Income from investment operations
Net investment loss (0.19) (0.16) (0.11) (0.02)
Net realized and unrealized gains on
securities and foreign currency
related transactions 3.41 1.38 1.77 0.59
------ ------ ------ ------
Total from investment operations 3.22 1.22 1.66 0.57
------ ------ ------ ------
Distributions to shareholders from
Net realized gains 0 (0.06) (0.01) 0
------ ------ ------ ------
Total distributions to shareholders 0 (0.06) (0.01) 0
------ ------ ------ ------
Net asset value, end of period $17.89 $14.67 $13.51 $11.86
------ ------ ------ ------
Total return* 21.95% 9.05% 14.02% 5.00%
Ratios and supplemental data
Net assets, end of period (thousands) $4,486 $3,875 $2,386 $ 554
Ratios to average net assets:
Expenses** 2.57% 2.61% 2.65% 2.50%+
Interest Expense 0.14% N/A N/A N/A
Net investment income (1.15%) (1.06%) (0.80%) (0.67%)+
Portfolio turnover rate 33% 16% 29% 20%
</TABLE>
<TABLE>
<CAPTION>
Year Ended October 31,
------------------------------------
1999 # 1998 # 1997 # 1996 #
<S> <C> <C> <C> <C>
CLASS Y SHARES
Net asset value, beginning of period $ 15.05 $ 13.71 $ 11.91 $ 10.00
------- ------- ------- -------
Income from investment operations
Net investment income (loss) (0.03) (0.01) 0.03 0.07
Net realized and unrealized gains on
securities and foreign currency
related transactions 3.52 1.41 1.78 1.88
------- ------- ------- -------
Total from investment operations 3.49 1.40 1.81 1.95
------- ------- ------- -------
Distributions to shareholders from
Net investment income 0 0 0 (0.04)
Net realized gains 0 (0.06) (0.01) 0
------- ------- ------- -------
Total distributions to shareholders 0 (0.06) (0.01) (0.04)
------- ------- ------- -------
Net asset value, end of period $ 18.54 $ 15.05 $ 13.71 $ 11.91
------- ------- ------- -------
Total return 23.19% 10.23% 15.22% 19.60%
Ratios and supplemental data
Net assets, end of period (thousands) $47,043 $41,873 $35,461 $18,607
Ratios to average net assets:
Expenses** 1.57% 1.61% 1.64% 1.47%+
Interest Expense 0.14% N/A N/A N/A
Net investment income (0.16%) (0.09%) 0.23% 0.62%+
Portfolio turnover rate 33% 16% 29% 20%
</TABLE>
(a) For the period from June 3, 1996 (commencement of class operations) to Oc-
tober 31, 1996.
* Excluding applicable sales charges.
** Ratio of expenses to average net assets includes fee waivers and excludes
fee credits.
+ Annualized.
# Net investment income or loss is based on average shares outstanding during
the period.
See Combined Notes to Financial Statements.
34
<PAGE>
EVERGREEN
Global Opportunities Fund
Financial Highlights
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Year Ended October 31, Year Ended September 30,
---------------------------- -----------------------------
1999 # 1998 # 1997 (a) 1997 # 1996 1995
<S> <C> <C> <C> <C> <C> <C>
CLASS A SHARES
Net asset value,
beginning of period $ 19.26 $ 23.53 $ 24.90 $ 24.56 $ 23.43 $ 19.42
------- ------- ------- -------- -------- -------
Income from investment
operations
Net investment income
(loss) (0.18) (0.12) 0.02 (0.17) (0.06) (0.16)
Net realized and
unrealized gains or
losses on securities,
futures contracts and
foreign currency
related transactions 8.22 (2.62) (1.39) 1.76 1.19 4.17
------- ------- ------- -------- -------- -------
Total from investment
operations 8.04 (2.74) (1.37) 1.59 1.13 4.01
------- ------- ------- -------- -------- -------
Distributions to
shareholders from
Net realized gains (1.22) (1.53) 0 (1.25) 0 0
------- ------- ------- -------- -------- -------
Total distributions to
shareholders (1.22) (1.53) 0 (1.25) 0 0
------- ------- ------- -------- -------- -------
Net asset value, end of
period $ 26.08 $ 19.26 $ 23.53 $ 24.90 $ 24.56 $ 23.43
------- ------- ------- -------- -------- -------
Total return* 44.04% (12.42%) (5.50%) 6.95% 4.82% 20.65%
Ratios and supplemental
data
Net assets, end of
period (thousands) $53,533 $58,944 $98,031 $113,477 $250,427 $94,679
Ratios to average net
assets
Expenses** 1.77% 1.81% 1.87%+ 1.67% 1.62% 1.83%
Net investment income (0.81%) (0.54%) (1.40%)+ (0.69%) (0.53%) (0.83%)
Portfolio turnover rate 136% 127% 7% 72% 67% 35%
</TABLE>
<TABLE>
<CAPTION>
Year Ended October 31, Year Ended September 30,
------------------------------ ------------------------------
1999 # 1998 # 1997 (a) 1997 # 1996 1995
<S> <C> <C> <C> <C> <C> <C>
CLASS B SHARES
Net asset value,
beginning of period $ 18.39 $ 22.69 $ 24.03 $ 23.92 $ 23.00 $ 19.20
-------- -------- -------- -------- -------- --------
Income from investment
operations
Net investment loss (0.32) (0.28) (0.06) (0.32) (0.21) (0.25)
Net realized and
unrealized gains or
losses on securities,
futures contracts and
foreign currency
related transactions 7.80 (2.49) (1.28) 1.68 1.13 4.05
-------- -------- -------- -------- -------- --------
Total from investment
operations 7.48 (2.77) (1.34) 1.36 0.92 3.80
-------- -------- -------- -------- -------- --------
Distributions to
shareholders from
Net realized gains (1.22) (1.53) 0 (1.25) 0 0
-------- -------- -------- -------- -------- --------
Total distributions to
shareholders (1.22) (1.53) 0 (1.25) 0 0
-------- -------- -------- -------- -------- --------
Net asset value, end of
period $ 24.65 $ 18.39 $ 22.69 $ 24.03 $ 23.92 $ 23.00
-------- -------- -------- -------- -------- --------
Total return* 43.02% (13.06%) (5.58%) 6.14% 4.00% 19.79%
Ratios and supplemental
data
Net assets, end of
period (thousands) $111,267 $122,147 $216,471 $238,936 $385,839 $238,320
Ratios to average net
assets
Expenses** 2.53% 2.55% 2.62%+ 2.46% 2.40% 2.58%
Net investment income (1.57%) (1.30%) (2.15%)+ (1.45%) (1.37%) (1.59%)
Portfolio turnover rate 136% 127% 7% 72% 67% 35%
</TABLE>
(a) For the one-month period ended October 31, 1997. The Fund changed its fis-
cal year end from September 30 to October 31, effective October 31, 1997.
* Excluding applicable sales charges.
** Ratio of expenses to average net assets includes fee waivers and excludes
fee credits.
+ Annualized.
# Net investment income or loss is based on average shares outstanding during
the period.
See Combined Notes to Financial Statements.
35
<PAGE>
EVERGREEN
Global Opportunities Fund
Financial Highlights
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Year Ended October 31, Year Ended September 30,
---------------------------- ----------------------------
1999 # 1998 # 1997 (a) 1997 # 1996 1995
<S> <C> <C> <C> <C> <C> <C>
CLASS C SHARES
Net asset value,
beginning of period $ 18.43 $ 22.73 $ 24.07 $ 23.97 $ 23.04 $ 19.26
------- ------- ------- ------- -------- -------
Income from investment
operations
Net investment loss (0.32) (0.28) (0.07) (0.33) (0.24) (0.27)
Net realized and
unrealized gains or
losses on securities,
futures contracts and
foreign currency
related transactions 7.81 (2.49) (1.27) 1.68 1.17 4.05
------- ------- ------- ------- -------- -------
Total from investment
operations 7.49 (2.77) (1.34) 1.35 0.93 3.78
------- ------- ------- ------- -------- -------
Distributions to
shareholders from
Net realized gains (1.22) (1.53) 0 (1.25) 0 0
------- ------- ------- ------- -------- -------
Total distributions to
shareholders (1.22) (1.53) 0 (1.25) 0 0
------- ------- ------- ------- -------- -------
Net asset value, end of
period $ 24.70 $ 18.43 $ 22.73 $ 24.07 $ 23.97 $ 23.04
------- ------- ------- ------- -------- -------
Total return* 42.98% (13.03%) (5.57%) 6.08% 4.04% 19.63%
Ratios and supplemental
data
Net assets, end of
period (thousands) $19,963 $23,043 $43,869 $49,524 $124,549 $86,339
Ratios to average net
assets
Expenses** 2.53% 2.56% 2.62%+ 2.45% 2.40% 2.58%
Net investment income (1.57%) (1.31%) (2.15%)+ (1.48%) (1.38%) (1.59%)
Portfolio turnover rate 136% 127% 7% 72% 67% 35%
</TABLE>
<TABLE>
<CAPTION>
Year Ended October 31,
-------------------------- Period Ended
1999 # 1998 # 1997 (a) September 30, 1997 (b)
<S> <C> <C> <C> <C>
CLASS Y SHARES
Net asset value, beginning
of period $19.58 $23.90 $25.24 $23.05
------ ------ ------ ------
Income from investment
operations
Net investment income (0.20) 0.09 0 (0.28)
Net realized and
unrealized gains or
losses on securities,
futures contracts and
foreign currency related
transactions 8.03 (2.88) (1.34) 2.47
------ ------ ------ ------
Total from investment
operations 7.83 (2.79) (1.34) 2.19
------ ------ ------ ------
Distributions to
shareholders from
Net realized gains (1.22) (1.53) 0 0
------ ------ ------ ------
Total distributions to
shareholders (1.22) (1.53) 0 0
------ ------ ------ ------
Net asset value, end of
period $26.19 $19.58 $23.90 $25.24
------ ------ ------ ------
Total return 42.20% (12.45%) (5.31%) 9.50%
Ratios and supplemental
data
Net assets, end of period
(thousands) $ 231 $ 31 $ 0 $ 0
Ratios to average net
assets
Expenses** 1.72% 1.49% 1.62%+ 1.42%+
Net investment income (0.49%) 0.17% (1.62%)+ (1.22%)+
Portfolio turnover rate 136% 127% 7% 72%
</TABLE>
(a) For the one-month period ended October 31, 1997. The Fund changed its fis-
cal year end from September 30 to October 31, effective October 31, 1997.
(b) For the period from January 13, 1997 (commencement of class operations) to
September 30, 1997.
* Excluding applicable sales charges.
** Ratio of expenses to average net assets includes fee waivers and excludes
fee credits.
+ Annualized.
# Net investment income or loss is based on average shares outstanding during
the period.
See Combined Notes to Financial Statements.
36
<PAGE>
EVERGREEN
International Growth Fund
Financial Highlights
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Year Ended October 31,
---------------------------
1999 # 1998 (a) #
<S> <C> <C>
CLASS A SHARES
Net asset value, beginning of period $ 7.47 $ 6.88
----------- -----------
Income from investment operations
Net investment income 0.06 0.10
Net realized and unrealized gains on securities,
futures contracts and foreign currency related
transactions 1.19 0.49
----------- -----------
Total from investment operations 1.25 0.59
----------- -----------
Net asset value, end of period $ 8.72 $ 7.47
----------- -----------
Total return* 16.73% 8.58%
Ratios and supplemental data
Net assets, end of period (millions) $ 128 $ 129
Ratios to average net assets
Expenses** 1.22% 1.53%+
Net investment income 0.77% 1.08%+
Portfolio turnover rate 131% 155%
</TABLE>
<TABLE>
<CAPTION>
Year Ended October 31,
-----------------------------------------
1999 # 1998 # 1997 # 1996 1995
<S> <C> <C> <C> <C> <C>
CLASS B SHARES
Net asset value, beginning of
period $7.43 $ 8.65 $ 7.69 $ 7.11 $ 7.77
----- ------ ------ ------ ------
Income from investment operations
Net investment income 0 (0.02) (0.05) (0.02) 0.07
Net realized and unrealized gains
on securities, futures contracts
and foreign currency related
transactions 1.19 0.67 1.27 0.75 0.05
----- ------ ------ ------ ------
Total from investment operations 1.19 0.65 1.22 0.73 0.12
----- ------ ------ ------ ------
Distributions to shareholders from
Net investment income 0 (0.33) (0.10) (0.10) (0.04)
Net realized gains 0 (1.54) (0.16) (0.05) (0.74)
----- ------ ------ ------ ------
Total distributions to shareholders 0 (1.87) (0.26) (0.15) (0.78)
----- ------ ------ ------ ------
Net asset value, end of period $8.62 $ 7.43 $ 8.65 $ 7.69 $ 7.11
----- ------ ------ ------ ------
Total return* 16.02% 9.35% 15.69% 10.47% 2.19%
Ratios and supplemental data
Net assets, end of period
(millions) $ 64 $ 75 $ 152 $ 148 $ 129
Ratios to average net assets
Expenses** 1.97% 2.30% 2.39% 2.43% 2.57%
Net investment income 0.01% (0.13%) (0.49%) (0.21%) 0.88%
Portfolio turnover rate 131% 155% 101% 52% 76%
</TABLE>
(a) For the period from January 20, 1998 (commencement of class operations) to
October 31, 1998.
* Excluding applicable sales charges.
** Ratio of expenses to average net assets includes fee waivers and excludes
fee credits.
+ Annualized.
# Net investment income or loss is based on average shares outstanding during
the period.
See Combined Notes to Financial Statements.
37
<PAGE>
EVERGREEN
International Growth Fund
Financial Highlights
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Year Ended
October 31,
-------------------
1999 # 1998 (a) #
<S> <C> <C>
CLASS C SHARES
Net asset value, beginning of period $7.43 $ 7.64
----- ------
Income from investment operations
Net investment income 0 0.03
Net realized and unrealized gains on securities, futures
contracts and foreign currency related transactions 1.19 (0.24)
----- ------
Total from investment operations 1.19 (0.21)
----- ------
Net asset value, end of period $8.62 $ 7.43
----- ------
Total return* 16.02% (2.75%)
Ratios and supplemental data
Net assets, end of period (millions) $ 2 $ 3
Ratios to average net assets
Expenses** 1.97% 2.19%+
Net investment income (0.02%) 0.44%+
Portfolio turnover rate 131% 155%
</TABLE>
<TABLE>
<CAPTION>
Year Ended
October 31,
------------------
1999 # 1998 (b) #
<S> <C> <C>
CLASS Y SHARES
Net asset value, beginning of period $7.45 $ 7.73
----- ------
Income from investment operations
Net investment income 0.08 0.07
Net realized and unrealized gains on securities, futures
contracts and foreign currency related transactions 1.20 (0.35)
----- ------
Total from investment operations 1.28 (0.28)
----- ------
Net asset value, end of period $8.73 $ 7.45
----- ------
Total return 17.18% (3.62%)
Ratios and supplemental data
Net assets, end of period (millions) $ 506 $ 428
Ratios to average net assets
Expenses** 0.97% 1.18%+
Net investment income 1.02% 1.13%+
Portfolio turnover rate 131% 155%
</TABLE>
(a) For the period from March 6, 1998 (commencement of class operations) to Oc-
tober 31, 1998.
(b) For the period from March 9, 1998 (commencement of class operations) to Oc-
tober 31, 1998.
* Excluding applicable sales charges.
** Ratio of expenses to average net assets includes fee waivers and excludes
fee credits.
+ Annualized.
# Net investment income is based on average shares outstanding during the pe-
riod.
See Combined Notes to Financial Statements.
38
<PAGE>
EVERGREEN
Latin America Fund
Financial Highlights
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Year Ended October 31,
------------------------------------------
1999 # 1998 # 1997 1996 1995
<S> <C> <C> <C> <C> <C>
CLASS A SHARES
Net asset value, beginning of
period $ 7.56 $13.15 $ 11.13 $ 9.86 $ 10.55
------ ------ ------- ------- -------
Income from investment operations
Net investment income 0.08 0.14 0.02 0.39 0.44
Net realized and unrealized gains
or losses on securities and
foreign currency related
transactions 0.74 (2.87) 2.10 1.24 (0.81)
------ ------ ------- ------- -------
Total from investment operations 0.82 (2.73) 2.12 1.63 (0.37)
------ ------ ------- ------- -------
Distributions to shareholders
from
Net investment income 0 0 (0.10) (0.36) (0.30)
Net realized gains 0 (2.86) 0 0 (0.02)
------ ------ ------- ------- -------
Total distributions to
shareholders 0 (2.86) (0.10) (0.36) (0.32)
------ ------ ------- ------- -------
Net asset value, end of period $ 8.38 $ 7.56 $ 13.15 $ 11.13 $ 9.86
------ ------ ------- ------- -------
Total return* 10.85% (27.18%) 19.18% 16.74% (3.35%)
Ratios and supplemental data
Net assets, end of period
(thousands) $4,853 $6,483 $13,621 $11,021 $14,333
Ratios to average net assets:
Expenses** 1.95% 1.86% 1.69% 1.83% 1.86%
Net investment income 1.05% 1.33% 0.20% 3.05% 4.02%
Portfolio turnover rate 238% 197% 105% 112% 57%
</TABLE>
<TABLE>
<CAPTION>
Year Ended October 31,
---------------------------------------------
1999 # 1998 # 1997 1996 1995
<S> <C> <C> <C> <C> <C>
CLASS B SHARES
Net asset value, beginning of
period $ 7.34 $ 12.91 $ 10.98 $ 9.76 $ 10.49
------- ------- ------- ------- -------
Income from investment
operations
Net investment income (loss) 0.01 0.06 (0.08) 0.23 0.32
Net realized and unrealized
gains or losses on securities
and foreign currency related
transactions 0.72 (2.77) 2.09 1.30 (0.75)
------- ------- ------- ------- -------
Total from investment
operations 0.73 (2.71) 2.01 1.53 (0.43)
------- ------- ------- ------- -------
Distributions to shareholders
from
Net investment income 0 0 (0.08) (0.31) (0.28)
Net realized gains 0 (2.86) 0 0 (0.02)
------- ------- ------- ------- -------
Total distributions to
shareholders 0 (2.86) (0.08) (0.31) (0.30)
------- ------- ------- ------- -------
Net asset value, end of period $ 8.07 $ 7.34 $ 12.91 $ 10.98 $ 9.76
------- ------- ------- ------- -------
Total return* 9.95% (27.60%) 18.40% 15.82% (4.00%)
Ratios and supplemental data
Net assets, end of period
(thousands) $20,752 $32,046 $75,271 $79,026 $97,165
Ratios to average net assets:
Expenses** 2.68% 2.61% 2.50% 2.59% 2.61%
Net investment income 0.16% 0.60% (0.51%) 2.30% 3.27%
Portfolio turnover rate 238% 197% 105% 112% 57%
</TABLE>
* Excluding applicable sales charges.
** Ratio of expenses to average net assets includes fee waivers and excludes
fee credits.
# Net investment income is based on average shares outstanding during the pe-
riod.
See Combined Notes to Financial Statements.
39
<PAGE>
EVERGREEN
Latin America Fund
Financial Highlights
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Year Ended October 31,
------------------------------------------
1999 # 1998 # 1997 1996 1995
<S> <C> <C> <C> <C> <C>
CLASS C SHARES
Net asset value, beginning of
period $ 7.32 $12.92 $ 10.99 $ 9.77 $ 10.50
------ ------ ------- ------ -------
Income from investment operations
Net investment income (loss) 0.01 0.05 (0.07) 0.23 0.32
Net realized and unrealized gains
or losses on securities and
foreign currency related
transactions 0.73 (2.79) 2.08 1.30 (0.75)
------ ------ ------- ------ -------
Total from investment operations 0.74 (2.74) 2.01 1.53 (0.43)
------ ------ ------- ------ -------
Distributions to shareholders
from
Net investment income 0 0 (0.08) (0.31) (0.28)
Net realized gains 0 (2.86) 0 0 (0.02)
------ ------ ------- ------ -------
Total distributions to
shareholders 0 (2.86) (0.08) (0.31) (0.30)
------ ------ ------- ------ -------
Net asset value, end of period $ 8.06 $ 7.32 $ 12.92 $10.99 $ 9.77
------ ------ ------- ------ -------
Total return* 10.11% (27.86%) 18.38% 15.80% (4.00%)
Ratios and supplemental data
Net assets, end of period
(thousands) $3,717 $4,725 $10,961 $8,791 $11,242
Ratios to average net assets:
Expenses** 2.65% 2.61% 2.47% 2.59% 2.61%
Net investment income 0.11% 0.54% (0.52%) 2.26% 3.27%
Portfolio turnover rate 238% 197% 105% 112% 57%
</TABLE>
<TABLE>
<CAPTION>
Year Ended
October 31,
------------------
1999 # 1998 (a) #
<S> <C> <C>
CLASS Y SHARES
Net asset value, beginning of period $7.58 $10.94
----- ------
Income from investment operations
Net investment income 0.06 0.07
Net realized and unrealized gains or losses on securities
and foreign currency related transactions 0.78 (3.43)
----- ------
Total from investment operations 0.84 (3.36)
----- ------
Net asset value, end of period $8.42 $ 7.58
----- ------
Total return 11.08% (30.71%)
Ratios and supplemental data
Net assets, end of period (thousands) $ 270 $ 28
Ratios to average net assets:
Expenses** 1.58% 1.49%+
Net investment income 0.71% 1.33%+
Portfolio turnover rate 238% 197%
</TABLE>
(a) For the period from March 30, 1998 (commencement of class operations) to
October 31, 1998.
* Excluding applicable sales charges.
** Ratio of expenses to average net assets includes fee waivers and excludes
fee credits.
+ Annualized.
# Net investment income is based on average shares outstanding during the
period.
See Combined Notes to Financial Statements.
40
<PAGE>
EVERGREEN
Perpetual International Fund
(formerly Mentor Perpetual International Portfolio)
Financial Highlights
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Year Ended October 31,
---------------------------------
1999 (b) (c) # 1998 # 1997 (a)
<S> <C> <C> <C>
CLASS A SHARES
Net asset value, beginning of period $ 14.65 $ 13.83 $ 12.53
------- ------- -------
Income from investment operations
Net investment income 0.07 0.11 0.01
Net realized and unrealized gains on
securities and foreign currency related
transactions 3.69 0.91 1.29
------- ------- -------
Total from investment operations 3.76 1.02 1.30
------- ------- -------
Distributions to shareholders from
Net investment income 0 (0.03) 0
Net realized gains 0 (0.03) 0
Tax return on capital 0 (0.14) 0
------- ------- -------
Total distributions to shareholders 0 (0.20) 0
------- ------- -------
Net asset value, end of period $ 18.41 $ 14.65 $ 13.83
------- ------- -------
Total return* 25.67% 7.43% 10.38%
Ratios and supplemental data
Net assets, end of period (thousands) $93,578 $62,782 $33,213
Ratios to average net assets
Expenses** 1.80% 1.35% 1.35%+
Net investment income 0.42% 0.96% 0.71%+
Portfolio turnover rate 118% 120% 107%
</TABLE>
<TABLE>
<CAPTION>
Period Ended
October 31, 1999 (d) #
<S> <C>
CLASS B SHARES
Net asset value, beginning of period $17.88
------
Income from investment operations
Net investment loss (0.01)
Net realized and unrealized gains on securities and
foreign currency related transactions 0.68
------
Total from investment operations 0.67
------
Net asset value, end of period $18.55
------
Total return* 3.75%
Ratios and supplemental data
Net assets, end of period (thousands) $ 248
Ratios to average net assets
Expenses** 2.56%+
Net investment income (0.36%)+
Portfolio turnover rate 118%
</TABLE>
(a) For the period from December 27, 1996 (commencement of class operations) to
October 31, 1997.
(b) Effective October 18, 1999, shareholders of Mentor Perpetual International
Portfolio Class A, Class B and Class Y shares became owners of that number
of full and fractional shares of Class A, Class C and Class Y shares, re-
spectively, of Evergreen Perpetual International Fund. In addition, Class B
shares of Mentor Perpetual International Portfolio were redesignated as
Class C shares of Evergreen Perpetual International Fund.
(c) As a result of the conversion of Mentor Perpetual International Portfolio
into Evergreen Perpetual International Fund, the shareholders of Mentor
Perpetual International Portfolio, Class E, became owners of that number of
full and fractional shares of Evergreen Perpetual International Fund, Class
A, having a net asset value equal to the net asset value of their shares
immediately prior to the conversion of shares.
(d) For the period from October 18, 1999 (commencement of class operations) to
October 31, 1999.
* Excluding applicable sales charges.
** Ratio of expenses to average net assets includes fee waivers and excludes
fee credits.
+ Annualized.
# Net investment income is based on average shares outstanding during the pe-
riod.
See Combined Notes to Financial Statements.
41
<PAGE>
EVERGREEN
Perpetual International Fund
(formerly Mentor Perpetual International Portfolio)
Financial Highlights
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Year Ended October 31,
-------------------------------
1999 (b) # 1998 # 1997 (a) #
<S> <C> <C> <C>
CLASS C SHARES
Net asset value, beginning of period $ 14.52 $ 13.81 $ 12.53
------- ------- -------
Income from investment operations
Net investment income (loss) (0.06) 0.03 0
Net realized and unrealized gains on
securities and foreign currency
related transactions 3.65 0.88 1.28
------- ------- -------
Total from investment operations 3.59 0.91 1.28
------- ------- -------
Distributions to shareholders from
Net investment income 0 (0.03) 0
Net realized gains 0 (0.03) 0
Tax return on capital 0 (0.14) 0
------- ------- -------
Total distributions to shareholders 0 (0.20) 0
------- ------- -------
Net asset value, end of period $ 18.11 $ 14.52 $ 13.81
------- ------- -------
Total return* 24.72% 6.64% 10.22%
Ratios and supplemental data
Net assets, end of period (thousands) $60,544 $42,354 $19,371
Ratios to average net assets
Expenses** 2.56% 2.10% 2.10%
Net investment income (0.36%) 0.21% 0.04%
Portfolio turnover rate 118% 120% 107%
</TABLE>
<TABLE>
<CAPTION>
Year Ended October 31,
---------------------------------------
1999 (b) # 1998 # 1997 # 1996 (c) #
<S> <C> <C> <C> <C>
CLASS Y SHARES
Net asset value, beginning of period $14.74 $ 13.89 $ 12.12 $12.50
------ ------- ------- ------
Income from investment operations
Net investment income 0.10 0.27 0.15 0.04
Net realized and unrealized gains or
losses on securities and foreign
currency related transactions 3.72 0.79 1.67 (0.42)
------ ------- ------- ------
Total from investment operations 3.82 1.06 1.82 (0.38)
------ ------- ------- ------
Distributions to shareholders from
Net investment income 0 (0.02) (0.05) 0
Net realized gains 0 (0.05) 0 0
Tax return on capital 0 (0.14) 0 0
------ ------- ------- ------
Total distributions to shareholders 0 (0.21) (0.05) 0
------ ------- ------- ------
Net asset value, end of period $18.56 $ 14.74 $ 13.89 $12.12
------ ------- ------- ------
Total return 25.92% 7.69% 15.07% (3.04%)
Ratios and supplemental data
Net assets, end of period (thousands) $6,572 $10,979 $16,110 $8,741
Ratios to average net assets
Expenses** 1.55% 1.10% 1.10% 1.10%+
Net investment income 0.64% 1.21% 1.20% 0.89%+
Portfolio turnover rate 118% 120% 107% 59%
</TABLE>
(a) For the period from December 27, 1996 (commencement of class operations) to
October 31, 1996.
(b) Effective October 18, 1999, shareholders of Mentor Perpetual International
Portfolio Class A, Class B and Class Y shares became owners of that number
of full and fractional shares of Class A, Class C and Class Y shares, re-
spectively, of Evergreen Perpetual International Fund. In addition, Class B
shares of Mentor Perpetual International Portfolio were redesignated as
Class C shares of Evergreen Perpetual International Fund.
(c) For the period from May 29, 1996 (commencement of class operations) to Oc-
tober 31, 1996.
* Excluding applicable sales charges.
** Ratio of expenses to average net assets includes fee waivers and excludes
fee credits.
+ Annualized.
# Net investment income is based on average shares outstanding during the pe-
riod.
See Combined Notes to Financial Statements.
42
<PAGE>
EVERGREEN
Precious Metals Fund
Financial Highlights
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Year Ended October 31,
---------------------------
1999 # 1998 (a) #
<S> <C> <C>
CLASS A SHARES
Net asset value, beginning of period $ 11.64 $ 12.45
----------- -----------
Income from investment operations
Net investment loss (0.01) (0.01)
Net realized and unrealized gains or losses on
securities and foreign currency related
transactions 0.25 (0.80)
----------- -----------
Total from investment operations 0.24 (0.81)
----------- -----------
Net asset value, end of period $ 11.88 $ 11.64
----------- -----------
Total return* 2.06% (6.51%)
Ratios and supplemental data
Net assets, end of period (thousands) $ 69,387 $ 83,431
Ratios to average net assets
Expenses** 2.01% 2.01%+
Net investment income (0.07%) (0.12%)+
Portfolio turnover rate 33% 44%
</TABLE>
<TABLE>
<CAPTION>
Year Ended October 31, Year Ended February 28,
---------------------------- ------------------------------
1997 (b)
1999 # 1998 # # 1997 1996 1995
------- ------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
CLASS B SHARES
Net asset value,
beginning of period $ 11.58 $ 15.87 $ 23.94 $ 26.35 $ 19.30 $ 25.09
------- ------- -------- -------- -------- --------
Income from investment
operations
Net investment loss (0.10) (0.19) (0.14) (0.26) (0.25) (0.13)
Net realized and
unrealized gains or
losses on securities
and foreign currency
related transactions 0.24 (3.29) (7.93) (1.16) 7.30 (5.54)
------- ------- -------- -------- -------- --------
Total from investment
operations 0.14 (3.48) (8.07) (1.42) 7.05 (5.67)
------- ------- -------- -------- -------- --------
Distributions to
shareholders from
Net investment income 0 0 0 0 0 (0.12)
Net realized gains 0 (0.81) 0 (0.99) 0 0
------- ------- -------- -------- -------- --------
Total distributions to
shareholders 0 (0.81) 0 (0.99) 0 (0.12)
------- ------- -------- -------- -------- --------
Net asset value, end of
period $ 11.72 $ 11.58 $ 15.87 $ 23.94 $ 26.35 $ 19.30
------- ------- -------- -------- -------- --------
Total return* 1.21% (22.60%) (33.71%) (5.16%) 36.53% (22.70%)
Ratios and supplemental
data
Net assets, end of
period (thousands) $13,781 $25,765 $111,173 $190,108 $217,270 $171,193
Ratios to average net
assets
Expenses** 2.76% 2.72% 2.48%+ 2.33% 2.28% 2.33%
Net investment income (0.94%) (1.52%) (1.04%)+ (1.08%) (1.08%) (0.54%)
Portfolio turnover rate 33% 44% 19% 41% 39% 75%
</TABLE>
(a) For the period from January 20, 1998 (commencement of class operations) to
October 31, 1998.
(b) For the eight-month period ended October 31, 1997. The Fund changed its
fiscal year end from February 28 to October 31, effective October 31, 1997.
* Excluding applicable sales charges.
** Ratio of expenses to average net assets includes fee waivers and excludes
fee credits.
+ Annualized.
# Net investment income or loss is based on average shares outstanding during
the period.
See Combined Notes to Financial Statements.
43
<PAGE>
EVERGREEN
Precious Metals Fund
Financial Highlights
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Year Ended
October 31,
-------------------
1999 # 1998 (a) #
<S> <C> <C>
CLASS C SHARES
Net asset value, beginning of period $11.58 $13.65
------ ------
Income from investment operations
Net investment loss (0.09) (0.14)
Net realized and unrealized gains or losses on securities
and foreign currency related transactions 0.22 (1.93)
------ ------
Total from investment operations 0.13 (2.07)
------ ------
Net asset value, end of period $11.71 $11.58
------ ------
Total return* 1.12% (15.16%)
Ratios and supplemental data
Net assets, end of period (thousands) $ 465 $ 557
Ratios to average net assets
Expenses** 2.85% 2.83%+
Net investment income (0.80%) (1.44%)+
Portfolio turnover rate 33% 44%
</TABLE>
(a) For the period from January 29, 1998 (commencement of class operations) to
October 31, 1998.
* Excluding applicable sales charges.
** Ratio of expenses to average net assets includes fee waivers and excludes
fee credits.
+ Annualized.
# Net investment income or loss is based on average shares outstanding
throughout the period.
See Combined Notes to Financial Statements.
44
<PAGE>
EVERGREEN
Emerging Markets Growth Fund
Schedule of Investments
October 31, 1999
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - 96.9%
Aerospace & Military
Technology - 2.1%
36,653 Elbit Systems Ltd. .................................. $ 526,887
250,000 Embraer-Empresa Brasileira de Aeronautica SA......... 832,479
-----------
1,359,366
-----------
Banking - 16.2%
35,800,000 Akbank Turk Anonim Sirket............................ 558,479
9,289 Alpha Credit Bank, GDR............................... 710,349
146,300 Amalgamated Bank South Africa........................ 596,516
34,100,000 Banco Bradesco SA.................................... 166,831
7,800 Banco de Galicia y Buenos Aires SA de CV, Cl. B,
ADR................................................. 164,775
5,000,000 Banco Est Sao Paulo SA............................... 128,330
6,400 Banco Frances del Rio de la Plata SA, ADR............ 140,000
3,890,000 Banco Itau SA........................................ 223,197
18,097 Bank Handlowy w Warszawie............................ 255,189
225,500 Bank Hapoalim Ltd.................................... 536,273
3,024,000 * Bank Negara Indonesa............................... 154,398
2,475,200 Bank Pan Indonesia................................... 288,864
1,294,630 Bank Sinopac......................................... 730,576
486,960 * Chinatrust Commercial Bank......................... 446,738
141,900 * Grupo Financiero Banamex AC, Ser. O................ 355,045
951,400 Grupo Financiero Bancomer SA, Ser. O................. 252,400
33,060 Housing & Commercial Bank............................ 873,699
39,400 * Kookmin Bank....................................... 614,239
154,000 Malayan Banking Berhad............................... 522,790
37,400 Metro Bank & Trust Co. .............................. 279,801
22,379 * Nedcor Investment Bank............................. 12,567
22,633 Nedcor Ltd. ......................................... 445,020
2,833 OTP Bank Rt. ........................................ 128,712
500,000 * Siam Commercial Bank............................... 566,636
22,792 Standard Bank Investment............................. 77,906
30,000 State Bank of India, GDR, 144A....................... 393,750
33,800,000 Turkiye Garanti Bankasi AS........................... 288,246
7,920,000 Turkiye Is Bankasi (Isbank).......................... 156,499
6,000 Uniao de Bancos Brasileiros SA, GDR ("Unibanco")..... 138,750
26,460,000 Yapi ve Kredi Bankasi AS............................. 385,257
-----------
10,591,832
-----------
Beverages & Tobacco - 5.4%
647,000 Cia Cervejaria Brahma................................ 412,661
23,400 Embotelladora Andina SA, Ser. A...................... 380,250
18,200 Fomento Economico Mexicano, Ser. B, ADR.............. 597,188
178,800 Grupo Modelo SA de CV, Ser. C........................ 437,141
10,753 Hellenic Bottling.................................... 242,580
9,600 Panamerican Beverages, Inc., Cl. A................... 154,200
28,500 Rembrandt Controlling Investments Ltd. .............. 122,931
68,175 Rembrandt Group Ltd. ................................ 509,895
66,500 * South African Brew................................. 590,073
10,500 Technical & Industrial Investments Ltd. ............. 43,581
-----------
3,490,500
-----------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - continued
Broadcasting & Publishing - 0.8%
11,650 * Grupo Televisa SA, ADR.............................. $ 495,125
-----------
Building Materials &
Components - 1.7%
20,768 Cemex SA de CV, Ser. B................................ 467,280
30,000 Larsen & Toubro Ltd., GDR, 144A....................... 639,000
-----------
1,106,280
-----------
Chemicals - 3.3%
171,840 Formosa Plastic Corp. ................................ 344,005
11,000 L.G. Chemical Ltd. ................................... 332,889
289,710 Nan Ya Plastic Corp. ................................. 506,901
69,100 Reliance Industries Ltd., GDR, 144A................... 852,003
3,200 Sociedad Quimica y Minera de Chile SA, ADR............ 93,000
-----------
2,128,798
-----------
Construction - 0.4%
38,275 Corporacion GEO SA de CV, Ser. B...................... 97,161
120,000 Italian-Thai Development Plc.......................... 142,209
-----------
239,370
-----------
Electrical & Electronics - 2.4%
38,100 Delta Electronics, Inc. .............................. 311,866
105,300 Electricity Generating Public Co. .................... 139,109
46,100 * Hyundai Electronics Ind. ........................... 766,732
43,680 Quanta Computer, Inc. ................................ 358,033
-----------
1,575,740
-----------
Electronic Components - 9.4%
173,650 Acer Peripherals Inc. ................................ 462,592
53,900 Asustek Computer Inc. ................................ 565,848
15,800 Samsung Electronics................................... 2,634,431
373,860 * Taiwan Semiconductor................................ 1,661,862
315,501 * United Microelectronics Corp. ...................... 820,581
-----------
6,145,314
-----------
Energy Equipment & Services - 1.1%
34,000 BSES Ltd. ............................................ 399,500
3,900 * Gulf Indonesia Resources Ltd. ...................... 30,956
41,300 PTT Exploration & Production Public Co., Ltd. ........ 301,687
-----------
732,143
-----------
Energy Sources - 4.1%
11,418 MOL Magyar Olaj-es Gazipari Rt., GDR.................. 230,140
69,531 Perez Companc SA, Cl. B............................... 418,774
41,120 Petroleo Brasileiro SA, ADR ("Petrobras")............. 657,233
101,863 Petroleos de Chile SA................................. 362,568
36,780 Sasol Ltd. ........................................... 251,438
23,161 * SK Corp., GDR, 144A................................. 444,104
14,576 Ssangyong Oil Refining Co, Ltd. ...................... 331,742
-----------
2,695,999
-----------
</TABLE>
45
<PAGE>
EVERGREEN
Emerging Markets Growth Fund
Schedule of Investments(continued)
October 31, 1999
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - continued
Financial Services - 0.7%
11,091 Samsung Securities Co. ............................... $ 388,347
13,600 Technical Investment Corp. ........................... 53,127
-----------
441,474
-----------
Food & Household Products - 1.8%
850,000 * Golden Agri- Resources Ltd. ........................ 344,250
165,976 Grupo Industrial Bimbo, Ser. A........................ 304,600
124,200 Kimberly Clark Corp. de Mexico SA de CV, Cl. A........ 397,978
269,700 Migros Turk TAS....................................... 116,402
-----------
1,163,230
-----------
Forest Products & Paper - 1.1%
20,183 Empresas CMPC......................................... 181,439
600,000 Indah Kiat Pulp & Paper............................... 258,206
33,977 Sappi Ltd. ........................................... 281,496
-----------
721,141
-----------
Health & Personal Care - 1.6%
43,400 Pliva D.D., GDR, 144A................................. 466,550
5,000 Ranbaxy Laboratories Ltd., GDR, 144A.................. 100,500
20,500 * Taro Pharmaceutical Industries Ltd. ................ 358,750
2,800 Teva Pharmaceutical Industries Ltd., ADR.............. 135,450
-----------
1,061,250
-----------
Insurance - 1.9%
17,560,000 Aksigorta A.S. ....................................... 538,740
105,450 Cathay Life Insurance Co., Ltd. ...................... 272,601
12,470 Hyundai Fire & Marine Co., Ltd. ...................... 263,019
19,435 Liberty Life Association of Africa, Ltd. ............. 180,314
-----------
1,254,674
-----------
Leisure & Tourism - 0.6%
38,000 Indian Hotels Co., Ltd. .............................. 389,500
-----------
Merchandising - 2.5%
393,400 * Cifra SA de CV, Ser. V.............................. 618,832
274,912 New Clicks Holdings Ltd. ............................. 398,248
122,720 President Chain Store Corp. .......................... 346,262
31,100 * Santa Isabel SA, ADR................................ 248,800
-----------
1,612,142
-----------
Metals - Non Ferrous - 2.6%
16,405 Anglo-American Platinum Corp. Ltd. ................... 472,628
15,300 AngloGold Ltd, ADR.................................... 429,356
30,037 De Beers Centenary.................................... 820,387
-----------
1,722,371
-----------
Metals - Steel - 1.8%
715,000 China Steel Corp. .................................... 550,000
26,600 Companhia Vale do Rio Doce, ADR....................... 518,772
62,400 Siderca SA............................................ 119,240
-----------
1,188,012
-----------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - continued
Multi-Industry - 4.7%
46,600 ALFA SA de CV, Ser. A................................ $ 178,895
12,370 Anglo American Plc................................... 658,396
918,000 Astra Agro Lestari................................... 294,617
1,168,000 Ayala Corp. ......................................... 291,272
68,443 Barlow Ltd. ......................................... 333,654
7,000 Desc SA de CV, Ser. C, ADR........................... 111,125
32,204 Elektrim Spolka Akcyjna SA........................... 278,575
50,000 Genting Berhad....................................... 178,947
71,400 * Grupo Carso SA de CV, Ser. A1...................... 299,357
15,000 ITC Corp. Ltd. ...................................... 277,500
585,000 JG Summit Holdings, Inc., Ser. B..................... 50,331
100,000 Kuala Lumpur Kepong Bertial.......................... 128,947
-----------
3,081,616
-----------
Technology - 1.1%
16,800 Aptech Ltd. ......................................... 340,567
25,000 Pentafour Software & Exports Ltd. ................... 347,270
-----------
687,837
-----------
Telecommunications - 24.5%
58,127 * Bezeq Israeli Telecommunication Corp. Ltd. ........ 236,915
11,000 Compania Anonima Nacional Telefonos de Venezuela, Cl.
D, ADR.............................................. 283,937
15,900 Compania de Telecom de Chile SA, ADR................. 265,331
6,768 ECI Telecommunications Ltd. ......................... 197,118
32,900 * Embratel Participacoes SA, ADR..................... 423,587
62,794 Hellenic Telecommunications Organization SA, GDR..... 1,330,551
266,000 Indosat, ADR......................................... 430,722
29,000 Korea Telecom Corp. ................................. 1,022,250
6,995 L.G. Electronics, GDR, 144A.......................... 229,182
37,500 Mahanagar Telep Ni, GDR.............................. 300,000
118,463 Mahanagar Telephone Nigam Ltd., GDR.................. 986,797
15,981 * Matav Rt., ADR..................................... 460,453
20,000 Philippine Long Distance
Telephone Co. ...................................... 411,250
614 SK Telecom Ltd. ..................................... 708,954
15,000 SK Telecom Ltd., ADR................................. 195,938
16,100 * SPT Telecom AS..................................... 242,952
25,600 * STET Hellas Telecommunications SA.................. 550,400
4,100 Tele Centro Sul Participacoes SA, ADR................ 244,975
31,327 Tele Norte Leste Participacoes SA, ADR............... 528,643
328,000 * Telecom Asia Corp. ................................ 252,765
2,900 * Telecomunicacoes Brasileiras SA, ADR Preference
Shares ("Telebras")................................. 225,838
14,200 Telefonica de Argentina, Cl. B, ADR.................. 363,875
29,500 Telefonica del Peru SA, Cl. B, ADR................... 341,094
31,807 Telefonos de Mexico SA, ADR.......................... 2,719,498
207,000 Telekom Malaysia Berhad.............................. 637,342
</TABLE>
46
<PAGE>
EVERGREEN
Emerging Markets Growth Fund
Schedule of Investments(continued)
October 31, 1999
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - continued
Telecommunications - continued
55,800 Telekomunikacja Polaska SA............................ $ 283,000
756,000 Telekomunikasi Indonesia, Ser. B...................... 358,425
9,700 Telesp Celular Participacoes.......................... 238,862
15,800 Telesp Participacpoes SA, ADR......................... 255,762
4,145,000 Vestel Electronic..................................... 508,674
46,300 Videsh Sanchar Nigam Ltd., GDR, 144A.................. 724,595
-----------
15,959,685
-----------
Textiles - 0.5%
243,960 Far East Textile Inc. ................................ 333,791
-----------
Transportation - Roads & Rail - 0.7%
1,400,000 Jiangsu Expressway.................................... 214,456
1,500,000 Zhejiang Expressway................................... 229,774
-----------
444,230
-----------
Transportation - Shipping - 0.3%
1,096,000 * China Shipping Haisheng Co., Ltd. .................. 204,570
-----------
Utilities - Electric, Gas &
Water - 3.4%
73,500 Centrais Eletricas Brasileiras SA, ADR................ 628,807
14,031 Empresa Nacional de Electric, ADR..................... 178,895
19,000 * Huaneng Power Intl., Inc., ADR...................... 230,375
60,000 Korea Electric Power Corp., ADR....................... 945,000
60,000 Petronas Gas Berhad................................... 127,105
12,900 Transportadora de Gas del Sur SA, ADR ("TGS")......... 108,038
-----------
2,218,220
-----------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - continued
Wholesale & International
Trade - 0.2%
95,000 Siam Makro Plc....................................... $ 159,953
-----------
Total Common Stocks
(cost $56,536,519).................................. 63,204,163
-----------
WARRANTS - 0.0%
Banking - 0.0%
218,400 * Bank Pan Indonesia (cost $0)....................... 8,602
-----------
RIGHTS - 0.0%
Banking - 0.0%
3,957 * Kookmin Bank, Expire 11/4/1999..................... 1,403
-----------
Financial Services - 0.0%
2,661 Samsung Securities, Expire 11/23/1999................ 4,509
-----------
Total Rights
(cost $0)........................................... 5,912
-----------
<CAPTION>
Principal
Amount Value
<C> <S> <C>
SHORT-TERM INVESTMENTS - 1.3%
U. S. Agency Obligations - 1.3%
$ 847,000 Federal Home Loan Bank Consolidated Discount Note
5.16%, 11/1/1999 (cost $847,000).................... $ 847,000
-----------
</TABLE>
<TABLE>
<C> <S> <C> <C>
Total Investments -
(cost $57,383,519)............................ 98.2% 64,065,677
Other Assets and Liabilities - net............. 1.8 1,172,236
-----------
Net Assets..................................... 100.0% $65,237,913
===== ===========
</TABLE>
* Non-income producing security.
144A Security that may be resold to "qualified institutional buyers" under Rule
144A of the Securities Act of 1933. This security has been determined to
be liquid under guidelines established by the Board of Trustees.
Summary of Abbreviations
ADR American Depository Receipt
GDR Global Depository Receipt
47
<PAGE>
EVERGREEN
Emerging Markets Growth Fund
Schedule of Investments (continued)
October 31, 1999
At October 31, 1999, the Fund held securities in the following countries:
<TABLE>
<CAPTION>
Percentage of
Market Value Portfolio Assets
- --------------------------------------------------------------------------------
<S> <C> <C>
Korea............................................. $ 9,756,437 15.2%
Taiwan............................................ 7,399,791 11.6%
Mexico............................................ 7,331,625 11.5%
Brazil............................................ 5,624,729 8.8%
India............................................. 5,126,211 8.0%
South Africa...................................... 5,029,064 7.8%
Greece............................................ 2,833,880 4.4%
Turkey............................................ 2,552,297 4.0%
Indonesia......................................... 2,172,060 3.4%
Israel............................................ 1,991,393 3.1%
Thailand.......................................... 1,874,226 2.9%
Chile............................................. 1,710,283 2.7%
Malaysia.......................................... 1,595,132 2.5%
Argentina......................................... 1,314,701 2.1%
United Kingdom.................................... 1,248,469 1.9%
Philippines....................................... 1,032,653 1.6%
Other+............................................ 5,472,726 8.5%
----------- ------
$64,065,677 100.0%
=========== ======
</TABLE>
+ Includes short-term securities.
See Combined Notes to Financial Statements.
48
<PAGE>
EVERGREEN
Global Leaders Fund
Schedule of Investments
October 31, 1999
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - 91.8%
Australia - 1.0%
54,500 National Australia Bank, Ltd. ....................... $ 4,274,844
Belgium - 1.1%
35,000 Colruyt NV........................................... 1,918,048
3,500 * Dolmen Computer Applications NV.................... 67,040
75,000 UCB SA............................................... 2,796,606
------------
4,781,694
------------
Canada - 3.2%
500,000 Bombardier, Inc., Cl. B.............................. 8,815,137
65,000 * Canadian Natural Resources Ltd. ................... 1,430,804
120,000 Du Pont Canada, Inc., Cl. A.......................... 3,994,836
------------
14,240,777
------------
Denmark - 0.8%
37,500 Coloplast AS......................................... 3,688,307
------------
Finland - 1.6%
60,000 Nokia Corp., ADR..................................... 6,933,750
------------
France - 4.4%
22,800 Carrefour SA......................................... 4,220,863
47,000 Hermes International................................. 5,141,442
88,400 * Sanofi Synthelabo.................................. 3,900,659
38,320 Societe Technip...................................... 3,889,615
15,564 Sodexho Alliance..................................... 2,553,875
------------
19,706,454
------------
Germany - 5.5%
70,000 Altana AG............................................ 4,940,539
44,000 Hugo Boss AG......................................... 4,998,391
180,050 RWE AG............................................... 7,253,467
10,000 SAP AG............................................... 3,715,134
130,000 Suedzucker AG........................................ 1,969,063
4,968 VEW AG............................................... 1,518,034
------------
24,394,628
------------
Hong Kong - 1.3%
1,635,000 Axa China Region Ltd. ............................... 1,410,118
35,633 Cable & Wireless Hong Kong Ltd. ..................... 81,417
181,000 Cheung Kong Holdings Ltd. ........................... 1,648,420
200,000 Henderson Land Development Co., Ltd. ................ 908,798
1,428,020 Hong Kong & China Gas Co. Ltd. ...................... 1,893,365
------------
5,942,118
------------
Ireland - 1.0%
14,510 CRH Plc.............................................. 273,959
217,137 CRH Plc, London Exchange............................. 4,099,699
------------
4,373,658
------------
Italy - 4.9%
175,000 Benetton Group SpA, ADS.............................. 7,689,063
395,000 Industrie Natuzzi SpA, ADR........................... 7,208,750
352,000 Luxottica Group SpA, ADS............................. 6,754,000
------------
21,651,813
------------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - continued
Japan - 8.4%
90,000 Nintendo Co., Ltd. .................................. $ 14,285,029
250,800 Seven-Eleven Japan Co. Ltd. ......................... 22,970,556
------------
37,255,585
------------
Malaysia - 0.6%
101,000 AMMB Holdings Berhad................................. 217,947
254,000 Commerce Asset Holding Berhad........................ 561,474
254,000 Malayan Banking Berhad............................... 862,263
92,000 Malaysian Oxygen Berhad.............................. 174,316
81,000 Nestle Berhad........................................ 298,421
134,000 Perusahaan Otomobil Nasional Berhad.................. 246,842
180,000 RHB Capital Berhad................................... 162,000
166,000 * United Engineers Ltd. Berhad....................... 281,763
------------
2,805,026
------------
Netherlands - 4.4%
21,093 CSM NV............................................... 993,963
60,757 CSM NV, Certificates................................. 2,802,333
84,901 Getronics NV......................................... 4,232,967
52,086 IHC Caland NV........................................ 2,259,949
80,931 Numico Kon NV........................................ 3,298,681
90,000 VNU NV............................................... 3,043,528
81,416 Wolters Kluwer NV.................................... 2,720,701
------------
19,352,122
------------
Spain - 1.1%
2,400 Endesa SA............................................ 48,040
195,500 Endesa SA, ADR....................................... 3,897,781
140,000 Prosegur, CIA de Seguridad SA........................ 1,148,620
------------
5,094,441
------------
Sweden - 1.0%
164,000 Hennes & Mauritz, Cl. B.............................. 4,357,247
Switzerland - 2.0%
40,525 ABB AG............................................... 4,080,947
79 Roche Holding AG..................................... 948,435
18 Roche Holding AG, Bearer Shares...................... 314,112
1,665 Schweizerische Rueckversicherungs-Gesellschaft....... 3,451,683
------------
8,795,177
------------
United Kingdom - 7.4%
7,937 Astrazeneca Plc...................................... 358,535
112,755 Astrazeneca Plc, ADR................................. 5,158,541
368,102 Granada Group Plc.................................... 2,921,497
135,000 Laporte Plc.......................................... 1,113,596
1,215,000 * Laporte Plc, Cl. B................................. 9,982
237,100 Lloyds TSB Group Plc................................. 3,280,453
270,000 Morgan Crucible Co. Plc.............................. 1,078,103
217,000 Next Plc............................................. 2,340,910
180,000 Pearson Publishing Plc............................... 4,052,129
530,200 Rentokil Initial Plc................................. 1,775,119
19,024 SmithKline Beecham Plc............................... 245,393
50,000 SmithKline Beecham Plc, ADR.......................... 3,200,000
</TABLE>
49
<PAGE>
EVERGREEN
Global Leaders Fund
Schedule of Investments(continued)
October 31, 1999
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - continued
United Kingdom - continued
156,841 Smiths Industries Plc................................ $ 2,128,775
250,000 TI Group Plc......................................... 1,684,279
62,500 Vodafone AirTouch Plc, ADR........................... 2,996,094
156,307 Williams Plc......................................... 783,373
------------
33,126,779
------------
United States - 42.1%
75,000 Abbott Laboratories.................................. 3,028,125
95,900 AlliedSignal, Inc.................................... 5,460,306
37,312 American International Group, Inc. .................. 3,840,804
61,600 Avon Products, Inc. ................................. 1,986,600
120,000 Black & Decker Corp.................................. 5,160,000
95,000 Carnival, Corp. Cl. A................................ 4,227,500
151,250 * Cisco Systems, Inc. ............................... 11,192,500
187,500 Citigroup, Inc. ..................................... 10,148,437
30,000 Computer Associates International, Inc. ............. 1,695,000
25,000 * Dell Computer Corp. ............................... 1,003,125
72,900 Disney (Walt) Co. ................................... 1,922,738
68,000 Federal National Mortgage Assoc. .................... 4,811,000
60,000 Gannett Co., Inc. ................................... 4,627,500
101,250 Gap, Inc. ........................................... 3,758,906
69,000 General Electric Co. ................................ 9,353,812
40,000 General Mills, Inc. ................................. 3,487,500
100,000 Harley-Davidson, Inc. ............................... 5,931,250
90,000 Home Depot, Inc. .................................... 6,795,000
90,000 Intel Corp. ......................................... 6,969,375
130,000 Marriott International, Inc. Cl. A................... 4,379,375
90,350 Marsh & McLennan Co., Inc. .......................... 7,143,297
60,000 Maytag Corp. ........................................ 2,403,750
119,775 MBNA Corp. .......................................... 3,308,784
74,500 McGraw-Hill Companies, Inc. ......................... 4,442,062
68,000 Merck & Co., Inc. ................................... 5,410,250
119,000 * Microsoft Corp. ................................... 11,014,937
25,000 Morgan Stanley, Dean Witter, Discover & Co. ......... 2,757,813
54,250 * Oracle Systems Corp. .............................. 2,580,266
60,000 Pitney Bowes, Inc. .................................. 2,733,750
98,700 SBC Communications, Inc. ............................ 5,027,531
68,000 Schering-Plough Corp. ............................... 3,366,000
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - continued
United States - continued
60,000 Schwab (Charles) & Co., Inc. ...................... $ 2,336,250
50,000 SLM Holding Corp. ................................. 2,446,875
37,500 Sodexho Marriott Services, Inc. ................... 705,469
175,000 TJX Co., Inc. ..................................... 4,746,875
52,000 Tribune Co. ....................................... 3,120,000
52,665 United Technologies Corp. ......................... 3,186,233
125,000 Viad Corp. ........................................ 3,070,313
202,400 Wal-Mart Stores, Inc. ............................. 11,473,550
130,000 Wells Fargo Co. ................................... 6,223,750
------------
187,276,608
------------
Total Common Stocks
(cost $287,316,928)............................... 408,051,028
------------
PREFERRED STOCKS - 0.5%
Germany - 0.5%
75,000 RWE AG (cost $2,701,389)........................... 2,382,440
------------
WARRANTS - 0.0%
Malaysia - 0.0%
26,750 * Commerce Asset Holding, Warrants @ 7.45MYR expire
3/16/2002 (b)..................................... 22,245
33,200 * United Engineers Ltd. Berhad, expire 11/18/2002.. 0
------------
22,245
Total Warrants
(cost $16,302).................................... 22,245
------------
<CAPTION>
Principal
Amount Value
<C> <S> <C>
SHORT-TERM INVESTMENTS - 7.4%
United States - 7.4%
$32,834,000 State Street Bank & Trust Co. purchased 10/29/1999,
5.16%, maturing 11/1/1999, maturity
value $32,848,119 (cost $32,834,000) (a).......... 32,834,000
------------
</TABLE>
<TABLE>
<C> <S> <C> <C>
Total Investments -
(cost $322,868,619).......................... 99.7% 443,289,713
Other Assets and Liabilities - net............ 0.3 1,477,018
----- ------------
Net Assets.................................... 100.0% $444,766,731
===== ============
</TABLE>
(a) The repurchase agreement is fully collateralized by U.S. government and/or
agency obligations based on market prices plus accrued interest at
October 31, 1999.
(b) Investment is being fair valued in accordance with procedures established
by the Board of Trustees.
* Non-income producing security.
Summary of Abbreviations:
ADR American Depository Receipt
ADS American Depository Shares
50
<PAGE>
EVERGREEN
Global Leaders Fund
Schedule of Investments(continued)
October 31, 1999
At October 31, 1999, the Fund held securities in the following industries:
<TABLE>
<CAPTION>
Percent of
Market Value Portfolio Assets
- --------------------------------------------------------------------------------
<S> <C> <C>
Merchandising..................................... $ 85,797,826 19.4%
Health & Personal Care............................ 42,195,443 9.5%
Financial Services................................ 41,895,253 9.4%
Electrical & Electronics.......................... 33,104,976 7.5%
Cash & Cash Equivalents........................... 32,834,000 7.4%
Food & Household Products......................... 26,702,747 6.0%
Telecommunications................................ 26,231,292 5.9%
Technology........................................ 23,329,743 5.3%
Broadcasting & Publishing......................... 17,953,791 4.1%
Aerospace & Military Technology................... 17,461,676 3.9%
Utilities-Electric, Gas & Water................... 15,475,094 3.5%
Banking........................................... 15,364,784 3.5%
Building Materials & Components................... 8,545,036 1.9%
Business & Public Services........................ 7,934,499 1.8%
Multi-Industry.................................... 7,766,929 1.7%
Real Estate....................................... 7,642,062 1.7%
Leisure & Tourism................................. 6,150,237 1.4%
Other............................................. 26,904,325 6.1%
------------ ------
$443,289,713 100.0%
============ ======
</TABLE>
FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS
Forward Foreign Currency Exchange Contracts to Sell:
<TABLE>
<CAPTION>
Exchange U.S. Value at In Exchange Unrealized
Date Contracts to Deliver October 31, 1999 for U.S. $ Loss
- ------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
11/8/1999 3,728,100,000 Japanese Yen $35,805,301 $34,850,199 $(955,102)
</TABLE>
See Combined Notes to Financial Statements.
51
<PAGE>
EVERGREEN
Global Opportunities Fund
Schedule of Investments
October 31, 1999
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - 90.0%
Aerospace & Military Technology - 1.2%
669,960 Embraer-Empresa Brasileira de Aeronautica SA........ $ 2,230,912
------------
Automobiles - 1.2%
19,040 Brembo SpA.......................................... 218,297
123,000 Koito Manufacturing Co., Ltd. ...................... 706,598
155,000 NSK Ltd. ........................................... 1,241,248
------------
2,166,143
------------
Banking - 2.3%
607,400 Anglo Irish Bank Corp. Plc.......................... 1,424,733
166,600 Den Norske Bank AS.................................. 645,300
210,000 The Bank Of Yokohama, Ltd. ......................... 1,178,191
233 Verwalt & Private Bank.............................. 966,821
------------
4,215,045
------------
Beverages & Tobacco - 0.4%
15,000 * Al-Ahram Beverage Co. SA, GDR..................... 457,106
10,289 * Baron de Ley SA................................... 275,973
------------
733,079
------------
Broadcasting & Publishing - 2.2%
21,890 * Endemol Entertainment NV.......................... 748,312
5,800 * Tivo, Inc. (a).................................... 248,675
6 Yahoo Japan Corp. .................................. 3,164,861
------------
4,161,848
------------
Building Materials & Components - 0.7%
69,700 * Toll Brothers, Inc. .............................. 1,219,750
------------
Business & Public Services - 13.8%
990,939 Aegis Group Plc..................................... 2,605,296
1,750 Altran Technologies SA.............................. 599,896
340,158 Ashtead Group Plc................................... 969,774
135,691 Capita Group Plc.................................... 1,794,887
147,326 Compass Group Plc................................... 1,573,559
700,056 Computershare Ltd. ................................. 2,544,626
38,200 * Diamond Technology Partners, Inc. (a) ............ 2,468,675
26,500 * Electronics for Imaging, Inc. .................... 1,068,281
14,632 GTI Holding NV...................................... 296,270
76,600 * Labor Ready, Inc. ................................ 780,363
39,300 * Lamar Advertising Co. Cl. A (a)................... 2,122,200
5,000 * Marketwatch.com, Inc. (a)......................... 262,500
16,900 Navigant Consulting Co. (a)......................... 482,706
8,000 Oracle Corp. Japan.................................. 1,626,546
1,560 Penauille Polyservices.............................. 512,613
23,600 * PMC-Sierra, Inc. (a).............................. 2,224,300
13,500 Trend Micro, Inc. .................................. 2,680,061
41,100 TSI International Software Ltd. .................... 986,400
------------
25,598,953
------------
Chemicals - 0.8%
72,300 Georgia Gulf Corp. (a).............................. 1,558,969
------------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - continued
Communication Services - 1.8%
42,200 * Citadel Communications Corp. ..................... $ 2,038,788
20,700 * Entercom Communications Corp. (a)................. 1,031,119
44,700 Mosaic Group Inc ................................... 239,914
------------
3,309,821
------------
Construction - 0.9%
38,300 * Dycom Industries, Inc. (a)........................ 1,247,143
34,000 Fujitec Co., Ltd. .................................. 378,575
------------
1,625,718
------------
Data Processing & Reproduction - 3.7%
12,582 * Atos SA........................................... 1,611,947
17,100 Dassault Systemes SA................................ 709,213
57,500 Logica Plc.......................................... 877,756
514,226 Parity Group........................................ 1,715,300
38,463 Sage Group Plc...................................... 1,971,914
------------
6,886,130
------------
Education - 1.1%
7,500 Benesse Corp. ...................................... 1,604,009
24,000 * ITT Educational Services, Inc. ................... 474,000
------------
2,078,009
------------
Electrical & Electronics - 1.6%
48,300 * Natural Microsystems Corp. ....................... 1,156,181
6,200 * QLogic Corp. ..................................... 645,575
35,800 * Veeco Instruments, Inc. .......................... 1,214,963
------------
3,016,719
------------
Electronic Components - 3.8%
36,600 * Cymer, Inc. ...................................... 1,351,913
65,000 Ibiden Co. Ltd ..................................... 1,090,918
31,800 * Lattice Semiconductor Corp. ...................... 1,124,925
255,901 Pressac Holdings Plc................................ 1,017,601
11,000 Shinko Elec Inds.................................... 559,125
11,600 * Silicon Image, Inc. (a)........................... 512,575
41,700 * Three Five Systems Inc. .......................... 1,409,981
------------
7,067,038
------------
Energy Sources - 2.4%
15,826 Athabasca Oil Sands Trust........................... 254,825
15,000 Canadian Oil Sands Trust............................ 257,320
51,100 * CMP Group, Inc. .................................. 1,360,537
47,200 * Newfield Exploration Co. (a)...................... 1,389,450
23,700 * Stone Energy Corp. ............................... 1,152,413
------------
4,414,545
------------
Financial Services - 1.7%
1,900 Bellsystem 24, Inc. ................................ 1,822,192
99,850 Close Brothers Group Plc............................ 1,246,958
------------
3,069,150
------------
Food & Household Products - 4.2%
59,900 * CEC Entertainment Inc. ........................... 1,920,544
41,626 Gerresheimer Glas AG................................ 774,982
</TABLE>
52
<PAGE>
EVERGREEN
Global Opportunities Fund
Schedule of Investments(continued)
October 31, 1999
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - continued
Food & Household Products - continued
81,000 Hazlewood Foods Plc ................................ $ 126,444
1,321 Lindt & Spruengli AG................................ 3,111,192
19,586 Nutreco Holding NV.................................. 669,550
34,500 * Whole Foods Market, Inc. (a)...................... 1,173,000
------------
7,775,712
------------
Forest Products & Paper - 0.5%
64,100 Pope & Talbot, Inc. ................................ 929,450
------------
Health & Personal Care - 6.3%
37,000 * Alkermes, Inc. (a)................................ 1,306,563
13,400 Altana AG........................................... 945,760
33,700 * Apria Healthcare Group, Inc. ..................... 532,881
66,000 * Celltech Plc...................................... 493,453
205,473 Cochlear Ltd. ...................................... 2,240,615
50,900 * Cyberonics, Inc. ................................. 715,781
11,167 Fielmann AG......................................... 422,856
32,100 * LifePoint Hospitals, Inc. ........................ 379,181
15,800 * MEDE AMERICA Corp. ............................... 351,550
49,100 * Osteotech, Inc. (a)............................... 641,369
12,000 Paris Miki, Inc. ................................... 966,721
906 Phonak Holding AG................................... 1,396,772
315,034 Sonic Healthcare Ltd. .............................. 1,225,472
------------
11,618,974
------------
Industrial Components - 1.6%
40,100 * Cognex Corp. ..................................... 1,200,494
56,300 Roper Industries, Inc. ............................. 1,738,262
------------
2,938,756
------------
Insurance - 1.7%
16,000 Clarica Life Insurance Co. ......................... 258,713
312,700 Mediolanum SpA...................................... 2,542,501
5,600 Pohjola Group Insurance Corp. ...................... 300,409
------------
3,101,623
------------
Leisure & Tourism - 2.6%
3,500 Aruze Corp ......................................... 307,135
65,000 Brother Industries.................................. 174,547
444,111 Cannons Plc......................................... 1,393,847
4,983 * Club Mediterranee SA.............................. 498,978
435 Kuoni Reisen Holding AG............................. 1,854,950
47,700 Sol Melia SA........................................ 544,380
------------
4,773,837
------------
Machinery & Engineering - 6.0%
36,900 * Advanced Energy Industries, Inc. ................. 1,517,512
159,000 Amada Co. Ltd. ..................................... 1,219,910
39,700 * Astec Industries, Inc. ........................... 930,469
53,878 Boewe Systec, AG.................................... 1,365,785
410,450 FKI Plc............................................. 1,079,122
29,000 Fuji Machine Manufacturing Co. Ltd. ................ 1,348,902
1,155 * Georg Fischer AG.................................. 362,950
500 Kokusai Electric.................................... 6,234
33,800 Manitowoc Co., Inc. ................................ 1,009,775
75,450 McKechnie Plc ...................................... 477,320
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - continued
Machinery & Engineering - continued
3,000 Nidec Corp. ........................................ $ 582,622
7,890 Sidel............................................... 788,414
8,600 Singulus Technologies AG............................ 406,161
------------
11,095,176
------------
Merchandising - 2.5%
3,900 * American Eagle Outfitters, Inc. .................. 166,969
52,712 Laurus NV........................................... 1,172,664
1,500 Otsuka Kagu......................................... 445,957
91,100 Sobeys Inc ......................................... 1,237,856
15,200 * Superdiplo SA..................................... 278,673
26,000 Tanseisha Co ....................................... 174,547
109,600 * The Topps Company, Inc. .......................... 1,075,450
------------
4,552,116
------------
Miscellaneous Materials & Commodities - 0.3%
38,000 Noritz Corp. ....................................... 599,501
------------
Multi-Industry - 1.1%
13,238 Custos AB Ser. B.................................... 283,304
181,437 DCC Plc............................................. 1,335,911
15,300 Fugro NV............................................ 514,986
------------
2,134,201
------------
Technology - 12.8%
40,800 * Advanced Digital Information...................... 1,519,800
114,800 Auspex Systems, Inc. ............................... 638,575
36,900 * Clarify, Inc. (a)................................. 2,850,525
39,800 * Digital River, Inc. (a)........................... 902,962
20,000 * Eidos Plc......................................... 1,398,362
34,000 * Engage Technologies, Inc. ........................ 1,202,750
3,500 * Foundry Networks, Inc. ........................... 663,250
23,600 * Great Plains Software Inc. ....................... 1,309,800
7,800 * JNI Corp. (a)..................................... 416,813
72,100 * Kemet Corp. ...................................... 2,304,947
4,600 Keynote Systems, Inc. .............................. 208,725
4,187 * Logitech International SA......................... 763,620
123,300 * Maxtor Corp. ..................................... 678,150
51,000 Merkantildata ASA................................... 432,121
3,100 * NaviSite, Inc. ................................... 145,700
49,600 * Netegrity, Inc. .................................. 1,339,200
2,300 * Predictive Systems, Inc. ......................... 100,050
24,500 * SanDisk Corp. .................................... 1,485,312
2,274 SER Systeme AG...................................... 114,812
39,300 * Silknet Software, Inc. (a)........................ 3,144,000
9,182 Transiciel SA....................................... 530,229
39,000 Unify Corp. ........................................ 1,131,000
6,400 * Vitria Technology, Inc. .......................... 422,000
------------
23,702,703
------------
Telecommunications - 7.7%
3,600 Hikari Tsushin, Inc. ............................... 2,896,710
64,900 * ITC DeltaCom, Inc. (a)............................ 1,557,600
37,300 * Mastec, Inc. ..................................... 1,221,575
33,350 * Netcom AB, Ser. B................................. 1,384,852
</TABLE>
53
<PAGE>
EVERGREEN
Global Opportunities Fund
Schedule of Investments(continued)
October 31, 1999
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - continued
Telecommunications - continued
149,200 * Premiere Technologies, Inc. ...................... $ 820,600
44,900 * Primus Telecomm Group, Inc. ...................... 993,413
8,100 * Telegate SA....................................... 289,679
51,500 * Transaction Network Services, Inc. ............... 2,050,344
57,500 * US LEC Corp., Cl. A (a)........................... 1,592,031
41,500 * Viatel, Inc. ..................................... 1,385,063
------------
14,191,867
------------
Textiles - 0.4%
26,418 * Jones Apparel Group, Inc. ........................ 835,469
------------
Transportation-Roads & Rail - 0.3%
76,800 Laidlaw Inc ........................................ 474,815
------------
Transportation-Shipping - 0.8%
50,300 * Eagle USA Airfreight, Inc. ....................... 1,483,850
------------
Wholesale & International
Trade - 1.6%
41,036 Cortefiel SA........................................ 1,071,755
800,000 Li & Fung Ltd. ..................................... 1,364,485
3,733 Tag Heuer International SA.......................... 524,084
------------
2,960,324
------------
Total Common Stocks
(cost $114,083,227)................................ 166,520,203
------------
PREFERRED STOCKS - 0.3%
Health & Personal Care - 0.3%
2,875 Fresenius AG........................................ 470,244
------------
Total Preferred Stocks
(cost $502,199).................................... 470,244
------------
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
U.S. GOVERNMENT & AGENCY OBLIGATIONS - 0.0%
U.S. Treasury Obligations - 0.0%
$ 59,500 U.S. Treasury Bonds & Notes 7.25% - 9.25%,
2/15/2016 - 8/15/2022 (cost $59,500) (b).......... $ 59,500
------------
SHORT-TERM INVESTMENTS - 18.5%
Money Market Portfolio - 8.2%
15,114,243 Navigator Prime Portfolio - 8.2%
(cost $15,114,243) (b)............................ 15,114,243
------------
Repurchase Agreement - 10.3%
19,091,000 Evergreen Joint Repurchase Agreement, Investments
in repurchase agreements, purchased 10/29/1999,
5.25%, maturing 11/1/1999, maturity value
$19,099,352 (cost $19,091,000) (c)................ 19,091,000
------------
Total Short-Term Investments
(cost $34,205,243)................................ 34,205,243
------------
</TABLE>
<TABLE>
<C> <S> <C> <C>
Total Investments
(cost $148,850,169)........................ 108.8% 201,255,190
Other Assets and Liabilities - net.......... (8.8) (16,261,449)
----- ------------
Net Assets.................................. 100.0% $184,993,741
===== ============
</TABLE>
(a) All or a portion of this security is on loan.
(b) Represents investment of cash collateral received for securities on loan.
(c) The repurchase agreement is fully collateralized by U.S. government and/or
agency obligations based on market prices plus accrued interest at -
October 31, 1999.
* Non-income producing security.
Summary of Abbreviations:
GDRGlobal Depository Receipt
At October 31, 1999, the Fund held securities in the following countries:
<TABLE>
<CAPTION>
Percent of
Market Value Portfolio Assets
- --------------------------------------------------------------------------------
<S> <C> <C>
United States+.................................... $ 96,616,135 55.5%
Japan............................................. 24,775,112 12.3%
United Kingdom.................................... 18,741,593 9.3%
Switzerland....................................... 8,980,390 4.5%
Australia......................................... 6,010,713 3.0%
France............................................ 5,251,290 2.6%
Germany........................................... 4,790,279 2.4%
Netherlands....................................... 3,401,782 1.7%
Italy............................................. 2,760,798 1.4%
Ireland........................................... 2,760,644 1.4%
Canada............................................ 2,723,443 1.4%
Other............................................. 9,269,268 4.6%
------------ ------
$201,255,190 100.0%
============ ======
</TABLE>
+ Includes short-term securities.
See Combined Notes to Financial Statements.
54
<PAGE>
EVERGREEN
International Growth Fund
Schedule of Investments
October 31, 1999
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - 92.1%
Aerospace & Military
Technology - 0.6%
134,000 British Aerospace Plc............................... $ 792,679
1,070,620 Embraer-Empresa Brasileira de Aeronautica SA........ 3,565,077
------------
4,357,756
------------
Appliances & Household
Durables - 0.9%
247,191 Electrolux AB....................................... 4,929,392
132,000 Matsushita Electric Works Ltd. ..................... 1,278,604
------------
6,207,996
------------
Automobiles - 2.2%
83,400 Compagnie Generale des Etablissements Michelin,
Cl.B............................................... 3,631,785
24,000 Honda Motor Co., Ltd. .............................. 1,012,755
30,878 Peugeot SA.......................................... 5,927,421
149,000 Toyota Motor Corp. ................................. 5,158,627
------------
15,730,588
------------
Banking - 11.0%
176,100 Allied Irish Banks Plc.............................. 2,204,246
646,350 Anglo Irish Bank Corp. Plc.......................... 1,516,095
265,668 Argentaria SA....................................... 5,896,244
39,340 Banco Popular Espana SA............................. 2,648,306
220,000 Bank of Tokyo-Mitsubishi Ltd. ...................... 3,645,919
44,748 Banque Nationale de Paris........................... 3,930,193
226,538 Barclays Bank Plc................................... 6,949,852
182,591 DBS Group Holdings.................................. 2,063,795
10,923 Dexia Belgium (Credit Communal)..................... 1,600,467
938,550 HSBC Holdings Plc................................... 11,296,187
205,036 Lloyds TSB Group Plc................................ 2,836,824
668,700 National Australia Bank Ltd. ....................... 10,319,602
133,512 Royal Bank of Scotland Group Plc.................... 3,071,415
240,000 Sumitomo Bank Ltd. ................................. 3,862,281
428,082 Svenska Handelsbanken AB, Ser A..................... 5,934,016
200,000 The Bank Of Yokohama, Ltd. ......................... 1,122,087
21,480 UBS AG.............................................. 6,249,675
484 Verwalt & Private Bank.............................. 2,008,332
------------
77,155,536
------------
Beverages & Tobacco - 3.0%
26,400 * Al-Ahram Beverage Co. SA, GDR..................... 804,506
18,113 * Al-Ahram Beverage Co. SA, GDR, 144A............... 551,970
287,680 Bass Plc............................................ 3,153,012
1,111,100 Fosters Brewing Group Ltd. ......................... 2,953,229
501,000 Fraser & Neave Ltd. ................................ 2,138,580
64,670 Heineken NV......................................... 3,298,442
41,400 Pernod Ricard SA.................................... 2,795,691
401,000 Rembrandt Controlling Investments Ltd. ............. 1,729,658
174,556 Tabacalera, Ser. A.................................. 2,873,445
163,300 Technical & Industrial Investments Ltd. ............ 677,792
------------
20,976,325
------------
Broadcasting & Publishing - 4.6%
12,809 Edipresse SA......................................... $ 5,268,807
560,950 Mondadori Edit SpA................................... 10,508,527
200,205 Quebecor, Inc., Cl. B................................ 4,774,234
4,130,200 Seat Pagine Gialle SpA............................... 3,957,703
4,542 Springer (Axel) Verlag AG............................ 4,562,515
77,000 Tokyo Broadcasting System, Inc. ..................... 2,034,478
36,950 VNU NV............................................... 1,249,537
------------
32,355,801
------------
Building Materials &
Components - 2.0%
90,273 Cemex SA de CV, Ser. B............................... 2,031,142
44,672 Lafarge SA........................................... 4,299,424
1,280,000 Nippon Sheet Glass Co. .............................. 7,954,733
------------
14,285,299
------------
Business & Public Services - 2.9%
279,400 Aegis Group Plc...................................... 734,576
326,400 Ashtead Group Plc.................................... 930,550
11,941 Cap Gemini NV........................................ 1,808,660
250,334 Compass Group Plc.................................... 2,673,766
3,231 Holderbank Financiere Glarus AG...................... 3,978,604
131,700 Pearson Publishing Plc............................... 2,964,808
25,000 Secom Co. Ltd. ...................................... 2,680,541
25,000 Secom Co. Ltd., New Shares........................... 2,661,360
100,300 Telegraaf Holdings NV................................ 1,846,259
------------
20,279,124
------------
Chemicals - 2.1%
154,318 Akzo Nobel NV........................................ 6,645,355
545,000 Asahi Chemical Ind................................... 3,292,893
56,700 BASF AG.............................................. 2,549,605
2,630 * Celanese AG........................................ 41,496
83,000 Chugai Pharmaceutical Co. Ltd. ...................... 987,053
64,000 Nippon Shokubai Co. ................................. 336,971
165,000 Sumitomo Chemical Co., Ltd. ......................... 1,058,646
------------
14,912,019
------------
Data Processing &
Reproduction - 1.0%
15,892 * Atos SA............................................ 2,036,009
309,616 Logica Plc........................................... 4,726,387
------------
6,762,396
------------
Electrical & Electronics - 1.7%
15,447 * ASM Lithography Holding NV......................... 1,121,838
380,000 Fujikura Ltd. ....................................... 2,350,628
343,000 Hitachi Ltd. ........................................ 3,707,308
1,020,000 Sanyo Electric Co. Ltd. ............................. 4,891,148
------------
12,070,922
------------
Electronic Components - 0.7%
241,982 Smiths Industries Plc................................ 3,284,379
356,000 * Taiwan Semiconductor............................... 1,582,472
------------
4,866,851
------------
</TABLE>
55
<PAGE>
EVERGREEN
International Growth Fund
Schedule of Investments (continued)
October 31, 1999
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - continued
Energy Sources - 6.2%
1,313,300 BP Amoco............................................. $ 12,753,858
1,982,967 ENI SpA.............................................. 11,596,957
229,000 Nippon Oil Co. ...................................... 1,010,262
393,200 Petro-Canada......................................... 5,623,249
91,650 Repsol-YPF, SA....................................... 1,889,480
343,810 Shell Transportation &
Trading Co. Plc..................................... 2,632,659
60,679 Total Fina SA, Cl. B................................. 8,201,538
------------
43,708,003
------------
Financial Services - 3.5%
24,000 Acom Co., Ltd. ...................................... 2,623,957
219,250 Close Brothers Group Plc............................. 2,738,063
202,400 Lend Lease Corp. Ltd. ............................... 2,328,818
23,100 Orix Corp. .......................................... 3,101,563
310 Pargesa Holding AG................................... 528,767
8,800 Perpetual Plc........................................ 487,307
221,950 Prudential Corp. Plc................................. 3,479,315
5,240 Societe Eurafrance SA................................ 3,163,712
40,000 Takefuji Corp. ...................................... 5,178,862
255,550 Technical Investment Corp. .......................... 998,291
------------
24,628,655
------------
Food & Household Products - 2.1%
9,100 Groupe Danone........................................ 2,321,170
149,465 Koninklijke Ahold NV................................. 4,590,670
1,309 Lindt & Spruengli AG................................. 3,082,930
1,623 Nestle SA............................................ 3,130,368
100,000 Yamazaki Baking Co. ................................. 1,222,787
------------
14,347,925
------------
Forest Products & Paper - 1.8%
1,730,649 Jefferson Smurfit Group Plc.......................... 4,496,346
332,241 Stora Enso Oyj....................................... 4,368,346
124,419 UPM-Kymmene Oyj...................................... 3,926,103
------------
12,790,795
------------
Health & Personal Care - 7.3%
110,000 Banyu Pharmaceutical Co., Ltd. ...................... 2,013,906
46,424 Bayer AG............................................. 1,899,529
197,400 * Celltech Plc....................................... 1,475,872
50,900 * Fresenius Medical Care AG.......................... 3,533,585
212,949 Glaxo Wellcome Plc................................... 6,284,520
26,305 Hoechst AG........................................... 1,157,944
60,270 * ISS International Service System AS, Ser. B........ 3,232,596
109,000 Kao Corp. ........................................... 3,324,254
1,994 Novartis AG.......................................... 2,982,562
170,000 Parkway Holdings Ltd. ............................... 312,752
49,027 Pharmacia & Upjohn, Inc. ............................ 2,649,866
60,400 Pliva D.D., GDR, 144A................................ 649,300
102,677 Rhone-Poulenc SA, Cl. A.............................. 5,745,642
455 Roche Holding AG..................................... 5,462,507
6,693 Schering AG.......................................... 796,228
75,656 SmithKline Beecham Plc............................... 975,895
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - continued
Health & Personal Care - continued
777,900 Sonic Healthcare Ltd. ............................... $ 3,026,007
47,000 Taisho Pharmaceutical Co. ........................... 1,956,267
79,000 Yamanouchi Pharmaceutical Co., Ltd. ................. 3,583,677
------------
51,062,909
------------
Industrial Components - 2.5%
376,640 Assa Abloy AB........................................ 4,190,486
24,270 Compagnie de Saint Gobain............................ 4,212,186
749,439 Invensys Plc......................................... 3,682,118
76,300 McKechnie Plc........................................ 482,698
946,350 Williams Plc......................................... 4,742,876
------------
17,310,364
------------
Insurance - 5.0%
22,355 Allianz AG........................................... 6,807,333
279,258 Allied Zurich Plc.................................... 3,395,686
76,800 Assicurazioni Generali SpA........................... 2,463,853
80,548 AXA-UAP.............................................. 11,361,543
172,000 Clarica Life Insurance Co. .......................... 2,781,167
142,540 Fortis (NL) NV....................................... 4,907,231
255,200 * Manulife Financial Corp. .......................... 3,068,850
------------
34,785,663
------------
Leisure & Tourism - 0.4%
32,000 Brother Industries................................... 85,931
129,700 Cannons Plc.......................................... 407,065
709,930 Hilton Group Plc..................................... 2,169,794
------------
2,662,790
------------
Machinery & Engineering - 2.7%
664,000 Amada Co. Ltd. ...................................... 5,094,466
74,568 Boewe Systec, AG..................................... 1,890,268
26,000 Fuji Machine Manufacturing Co. Ltd. ................. 1,209,360
230,000 NTN Corp. ........................................... 836,003
58,100 SMC Corp. ........................................... 9,801,275
------------
18,831,372
------------
Merchandising - 3.3%
1,371,269 Dairy Farm International............................. 1,076,446
74,000 Familymart Co. Ltd. ................................. 5,145,296
84,710 Karstadt AG.......................................... 3,831,395
136,425 Laurus NV............................................ 3,034,996
614,845 New Clicks Holdings Ltd. ............................ 890,688
73,000 Seven-Eleven Japan Co. Ltd. ......................... 6,686,007
10,300 Sobeys Inc. ......................................... 139,955
88,300 Vendex International NV.............................. 2,577,374
------------
23,382,157
------------
Metals - Non Ferrous - 1.4%
730,450 Billiton Plc......................................... 3,180,728
2,447,000 * Mitsubishi Materials Corp. ........................ 6,453,678
------------
9,634,406
------------
Metals - Steel - 0.8%
2,408,000 * Kawasaki Steel Corp. .............................. 5,450,158
------------
</TABLE>
56
<PAGE>
EVERGREEN
International Growth Fund
Schedule of Investments (continued)
October 31, 1999
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - continued
Mining - 0.9%
114,660 Anglo American Plc................................... $ 6,102,808
------------
Miscellaneous Materials & Commodities - 0.2%
70,000 Toyo Seikan Kaisha Ltd. ............................. 1,523,928
------------
Multi-Industry - 1.8%
120,000 Mitsubishi Corp. .................................... 863,144
52,354 Preussag AG.......................................... 2,836,030
191,585 * Thyssen Krupp AG................................... 4,534,170
56,150 Vivendi.............................................. 4,255,372
------------
12,488,716
------------
Real Estate - 1.0%
708,000 Henderson Investment Ltd. ........................... 435,180
155,259 Sponda Oyj........................................... 689,165
11,545,300 Unione Immobiliare SpA............................... 5,938,378
------------
7,062,723
------------
Technology - 5.2%
150,000 Casio Computer Co. .................................. 1,030,018
76,000 Matsushita Communication Industries Co. Ltd. ........ 12,769,924
158,540 Nokia AB Oyj......................................... 18,145,186
46,685 STMicroelectronics................................... 4,100,319
------------
36,045,447
------------
Telecommunications - 10.3%
274,736 British Telecommunications Plc....................... 4,983,963
116,216 * Colt Telecom Group Plc............................. 3,469,853
216,702 Deutsche Telekom AG.................................. 9,960,889
92,400 * Embratel Participacoes SA, ADR..................... 1,189,650
46,106 France Telecom SA.................................... 4,454,412
60,000 Korea Telecom Corp., ADR............................. 2,115,000
52,446 Mannesmann AG........................................ 8,247,215
953 Nippon Telegraph & Telephone Corp. .................. 14,623,573
234,237 * Orange Plc......................................... 5,819,658
1,562,490 * Tecnost SpA........................................ 3,007,614
254,504 Telecom Italia Mobile (TIM) SpA...................... 1,590,138
122,830 * Telefonica SA...................................... 2,020,668
2,219,400 Vodafone Group Plc................................... 10,339,007
------------
71,821,640
------------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - continued
Textiles - 0.7%
16,391 Gamma Holding NV..................................... $ 655,153
377,000 * Kanebo............................................. 686,967
740,000 Teijin, Ltd. ........................................ 3,775,582
------------
5,117,702
------------
Transportation - Roads & Rail - 1.4%
307,200 Laidlaw Inc. ........................................ 1,899,260
1,073,000 Nippon Express Co. Ltd. ............................. 7,594,456
------------
9,493,716
------------
Utilities - Electric, Gas &
Water - 0.2%
110,250 Scot & Southern Energy Plc........................... 1,047,120
------------
Wholesale & International
Trade - 0.7%
715,000 Itochu Corp. ........................................ 2,633,164
805,000 Marubeni Corp. ...................................... 2,563,153
------------
5,196,317
------------
Total Common Stocks
(cost $542,730,205)................................. 644,455,927
------------
PREFERRED STOCKS - 0.5%
Health & Personal Care - 0.5%
20,130 Fresenius AG......................................... 3,292,516
------------
Total Preferred Stocks
(cost $3,362,419)................................... 3,292,516
------------
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
SHORT-TERM INVESTMENTS - 7.2%
Repurchase Agreement - 7.2%
$50,186,000 Evergreen Joint Repurchase Agreement Investments in
a joint trading account, purchased 10/29/1999,
5.25%, maturing 11/1/1999, maturity value
$50,207,956
(cost $50,186,000) (a)............................ 50,186,000
------------
</TABLE>
<TABLE>
<C> <S> <C> <C>
Total Investments -
(cost $596,278,624).......................... 99.8% 697,934,443
Other Assets and Liabilities - net............ 0.2 1,523,055
----- ------------
Net Assets.................................... 100.0% $699,457,498
===== ============
</TABLE>
(a) The repurchase agreement is fully collateralized by U.S. government and/or
agency obligations based on market prices plus accrued interest at
October 31, 1999.
* Non-income producing security.
144A Security that may be resold to "qualified institutional buyers" under Rule
144A of the Securities Act of 1933. This security has been determined to
be liquid under guidelines established by the Board of Trustees.
Summary of Abbreviations
ADR American Depository Receipt
GDR Global Depository Receipt
57
<PAGE>
EVERGREEN
International Growth Fund
Schedule of Investments(continued)
October 31, 1999
At October 31, 1999, the Fund held securities in the following countries:
<TABLE>
<CAPTION>
Percentage of
Market Value Portfolio Assets
- --------------------------------------------------------------------------------
<S> <C> <C>
Japan............................................. $160,877,648 23.1%
United Kingdom.................................... 124,065,298 17.8%
France............................................ 68,144,756 9.8%
Germany........................................... 55,940,717 8.0%
United States+.................................... 50,186,000 7.1%
Italy............................................. 39,063,170 5.6%
Netherlands....................................... 34,027,175 4.9%
Switzerland....................................... 32,692,554 4.7%
Finland........................................... 27,128,800 3.9%
Australia......................................... 18,627,656 2.7%
Canada............................................ 18,286,715 2.6%
Sweden............................................ 17,703,761 2.5%
Spain............................................. 15,328,143 2.2%
Ireland........................................... 8,216,687 1.2%
Singapore......................................... 5,591,573 0.8%
Other............................................. 22,053,790 3.1%
------------ ------
$697,934,443 100.0%
============ ======
</TABLE>
+ Repurchase Agreement.
See Combined Notes to Financial Statements.
58
<PAGE>
EVERGREEN
Latin America Fund
Schedule of Investments
October 31, 1999
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - 97.1%
Aerospace & Military
Technology - 6.3%
563,573 Embraer-Empresa Brasileira de Aeronautica SA......... $ 1,876,652
-----------
Banking - 8.0%
41,623,400 Banco Bradesco SA.................................... 203,639
22,900 Banco de Galicia y Buenos Aires SA de CV, Cl. B,
ADR................................................. 483,762
4,847,216 Banco Est Sao Paulo SA............................... 124,409
13,630 Banco Frances del Rio de la Plata SA, ADR............ 298,156
3,200,000 Banco Itau SA........................................ 183,607
179,700 * Grupo Financiero Banamex AC, Ser. O................ 449,624
1,651,795 Grupo Financiero Bancomer SA, Ser. O................. 438,210
8,600 Uniao de Bancos Brasileiros SA, GDR ("Unibanco")..... 198,875
-----------
2,380,282
-----------
Beverages & Tobacco - 9.9%
844,000 Cia Cervejaria Brahma................................ 538,310
25,282 Coca-Cola Co. Femsa SA, ADR.......................... 350,788
25,000 Embotelladora Andina SA.............................. 61,605
14,200 Embotelladora Andina SA, Ser. A, ADR................. 230,750
16,004 Fomento Economico Mexicano,
Ser. B, ADR......................................... 525,131
237,900 Grupo Modelo SA de CV, Ser. C........................ 581,632
30,228 Panamerican Beverages, Inc., Cl. A................... 485,537
28,400 Souza Cruz Cia SA.................................... 162,223
-----------
2,935,976
-----------
Broadcasting & Publishing - 4.0%
22,331 * Grupo Televisa SA, ADR............................. 949,067
54,200 TV Azteca SA de CV, ADR.............................. 220,188
-----------
1,169,255
-----------
Building Materials &
Components - 3.7%
38,343 Apasco SA de CV...................................... 203,443
158,389 Cementos Pacasmayo SA................................ 102,340
35,514 Cemex SA de CV, Ser. B, ADR.......................... 799,065
-----------
1,104,848
-----------
Chemicals - 0.3%
2,700 Sociedad Quimica y Minera de Chile SA, ADR........... 78,469
-----------
Construction - 1.1%
132,489 * Corporacion GEO SA de CV, Ser. B................... 336,322
-----------
Energy Sources - 6.5%
64,485 Perez Companc SA, Cl. B.............................. 388,382
75,450 Petroleo Brasileiro SA, ADR ("Petrobras")............ 1,205,940
89,091 Petroleos de Chile SA................................ 317,108
-----------
1,911,430
-----------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - continued
Food & Household Products - 3.7%
195,282 Grupo Industrial Bimbo, Ser. A....................... $ 358,383
177,100 Kimberly Clark Corp. de Mexico SA de CV, Cl. A....... 567,486
55,100 Mavesa SA, ADR....................................... 175,631
-----------
1,101,500
-----------
Forest Products & Paper - 0.6%
20,000 Empresas CMPC........................................ 179,794
-----------
Machinery & Engineering - 0.0%
38,160 Inepar Energia SA, Preference
Shares (b).......................................... 0
76,320 Inepar Energia SA (b)................................ 0
-----------
0
-----------
Merchandising - 6.4%
544,588 Cifra SA de CV, Ser. V............................... 856,655
21,237 Distribucion Y Servicio D&S, ADR..................... 346,429
143,300 Organizacion Soriana, Ser. B......................... 530,741
19,784 * Santa Isabel SA, ADR............................... 158,272
-----------
1,892,097
-----------
Metals - Steel - 3.9%
31,900 Companhia Vale do Rio Doce, ADR...................... 622,136
115,588 * Hylsamex SA de CV, Ser. B.......................... 306,647
111,000 Siderca SA........................................... 212,110
-----------
1,140,893
-----------
Mining - 1.8%
11,660,000 * Caemi Mineracao E Metalurgia SA.................... 546,563
-----------
Multi-Industry - 5.1%
103,254 ALFA SA de CV, Ser. A................................ 396,387
19,435 Desc SA de CV, Ser. C, ADR........................... 308,530
189,400 Grupo Carso SA de CV, Ser. A1........................ 794,093
-----------
1,499,010
-----------
Telecommunications - 29.5%
14,564 Compania Anonima Nacional Telefonos de Venezuela, Cl.
D, ADR.............................................. 375,933
16,000 Compania de Telecom de Chile SA, ADR................. 267,000
17,000,000 * Embratel Participacoes SA.......................... 216,855
41,700 * Embratel Participacoes SA, ADR..................... 536,888
13,600 Tele Centro Sul Participacoes SA, ADR................ 812,600
89,473 Tele Norte Leste Participacoes SA, ADR............... 1,509,857
4,900 Telecom Argentina - France Telecom SA, Cl. B, ADR.... 134,750
7,400,000 * Telecomunicacoes de Sao Paulo SA................... 695,645
20,474 Telefonica de Argentina, Cl. B, ADR.................. 524,646
25,828 Telefonica del Peru SA, Cl. B, ADR................... 298,636
34,087 Telefonos de Mexico SA, ADR.......................... 2,914,438
158,497 * Telemig Celular SA................................. 1,632
8,200,000 Telesp Celular SA.................................... 428,484
-----------
8,717,364
-----------
</TABLE>
59
<PAGE>
EVERGREEN
Latin America Fund
Schedule of Investments (continued)
October 31, 1999
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - continued
Utilities - Electric, Gas &
Water - 6.3%
141,579 Centrais Eletricas Brasileiras SA, ADR................ $ 1,211,237
488,000 Chilgener SA.......................................... 103,327
11,100 Companhia Brasileira De Distr, ADR.................... 242,812
24,073 Empresa Nacional de Electric, ADR..................... 306,931
-----------
1,864,307
-----------
Total Common Stocks
(cost $23,466,475)................................... 28,734,762
-----------
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
CONVERTIBLE DEBENTURES - 0.0%
Metals - Steel - 0.0%
$ 207,800 Compahnia Vale do Rio Doce de Navegacao SA (b)
1.00%, 12/31/1999 (cost $0).......................... 11
-----------
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
SHORT-TERM INVESTMENTS - 3.0%
Repurchase Agreement - 3.0%
$ 898,000 Evergreen Joint Repurchase Agreement Investments in a
joint trading account, purchased 10/29/1999, 5.25%,
maturing 11/1/1999, maturity value $898,393 (cost
$898,000) (a)....................................... $ 898,000
-----------
</TABLE>
<TABLE>
<C> <S> <C> <C>
Total Investments -
(cost $24,364,475)........................... 100.1% 29,632,773
Other Assets and Liabilities - net............ (0.1) (40,551)
----- -----------
Net Assets.................................... 100.0% $29,592,222
===== ===========
</TABLE>
(a) The repurchase agreement is fully collateralized by U.S. government and/or
agency obligations based on market prices plus accrued interest at
October 31, 1999.
(b) Security is being fair valued in accordance with procedures established by
the Board of Trustees.
* Non-income producing security.
Summary of Abbreviations
ADRAmerican Depository Receipts
GDRGlobal Depository Receipts
At October 31, 1999, the Fund held securities in the following countries:
<TABLE>
<CAPTION>
Percentage of
Market Value Portfolio Assets
- --------------------------------------------------------------------------------
<S> <C> <C>
Mexico............................................ $12,372,370 41.7%
Brazil............................................ 11,318,372 38.2%
Chile............................................. 2,049,684 6.9%
Argentina......................................... 2,041,807 6.9%
United States+.................................... 898,000 3.0%
Peru.............................................. 551,564 1.9%
Venezuela......................................... 400,976 1.4%
----------- ------
$29,632,773 100.0%
=========== ======
</TABLE>
+ Repurchase Agreement
See Combined Notes to Financial Statements.
60
<PAGE>
EVERGREEN
Perpetual International Fund
(formerly Mentor Perpetual International Portfolio)
Schedule of Investments
October 31, 1999
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - 96.8%
Aerospace & Military
Technology - 1.3%
81,200 British Aerospace Plc............................... $ 480,544
53,380 Celsius AB, Ser. B.................................. 839,779
10,500 Elbit Systems Ltd .................................. 149,668
165,000 Rolls-Royce Plc..................................... 585,886
------------
2,055,877
------------
Automobiles - 1.6%
120,000 Brilliance China Automotive Holdings Ltd. .......... 427,500
235,000 Fuji Heavy Industries, Ltd. (b)..................... 1,998,656
16,000 Mahindra & Mahindra Ltd. ........................... 125,200
------------
2,551,356
------------
Banking - 11.4%
40,400 Abbey National Bank Plc............................. 788,993
10,200,000 Akbank Turk Anonim Sirket........................... 159,120
6,200 Banco Bradesco S A.................................. 29,450
3,000 Banco De A Edward................................... 43,875
20,680 Bank Austria AG..................................... 1,030,673
32,000 Bank Of Scotland.................................... 400,322
150,000 Bank Of Tokyo-Mitsubishi Ltd. ...................... 2,488,121
25,770 Barclays Bank Plc................................... 790,922
223,975 BPI-SGPS, SA........................................ 897,362
29,937 Dresdner Bank AG.................................... 1,543,482
22,800 Grupo Financiero Banamex AC, Ser. O................. 56,911
12,000 Hansabank........................................... 60,351
20,000 Housing & Commercial Bank........................... 530,000
30,230 HSBC Holdings Plc, Hong Kong Exchange (b)........... 363,818
93,500 Lloyds TSB Group Plc................................ 1,294,192
43,600 National Westminster Bank Plc....................... 984,801
21,300 Overseas Chinese Bank............................... 160,247
75,372 Overseas Union Bank Ltd. ........................... 326,620
1,072,000 PT Bank Nisp........................................ 188,070
73,453 Sparbanken Sverige AB, Ser. A....................... 1,173,485
46,350 Standard Chartered Bank............................. 649,179
350,000 Sumitomo Trust & Banking Co. Ltd. .................. 3,581,473
1,600 Uniao de Bancos Brasileiros SA, GDR (b)............. 37,000
50,000 United Overseas Bank................................ 379,176
50,000 Wing Hang Bank Ltd. ................................ 163,148
18,000 Zagrebacka Banka Ulc Reg S, GDR..................... 160,200
------------
18,280,991
------------
Beverages & Tobacco - 2.5%
30,000 Allied Domecq....................................... 168,171
21,566 * Baron de Ley SA................................... 579,822
35,299 Bass Plc............................................ 387,047
76,700 British America Tobacco Industries Plc.............. 509,392
49,500 Diageo Plc.......................................... 503,699
2,000 Embotelladora Andina SA, Ser. A (b)................. 32,500
50,000 Gallaher Group Plc.................................. 301,244
22,700 Grupo Modelo SA de CV, Ser. C....................... 55,366
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - continued
Beverages & Tobacco - continued
20,000 PT Bat Indonesia Tbk................................. $ 64,327
250,000 PT HM Sampoerna...................................... 581,140
14,200 Scot & Newcastle..................................... 132,357
42,300 Tabacalera, Ser. A (b)............................... 697,974
-----------
4,013,039
-----------
Broadcasting & Publishing - 1.9%
30,000 BEC World Public Co. Ltd. ........................... 186,504
32,040 EMAP Plc............................................. 416,097
1,500 * Grupo Televisa SA, ADR (b)......................... 63,750
8,000 Nanyang Press Holdings............................... 9,937
80,000 Resorts World Berhad................................. 229,474
25,000 * Singapore Press Holdings Ltd. ..................... 428,829
28,600 Trinity Plc.......................................... 265,637
45,250 VNU NV............................................... 1,533,855
-----------
3,134,083
-----------
Building Materials &
Components - 2.4%
11,600 Benpres Holdings Corp. .............................. 36,250
46,666 Blue Circle Industries Plc........................... 216,718
42,500 Carillion Plc........................................ 88,422
2,300 Cemex SA de CV, Ser. B............................... 51,750
40,370 CRH Plc, London Exchange............................. 764,025
3,473 Geberit International AG............................. 1,024,827
8,080 Imerys SA............................................ 1,158,604
160,000 Pilkington Plc....................................... 240,009
46,000 * United Engineers Ltd. Berhad....................... 78,079
30,622 Wolseley Plc......................................... 208,657
-----------
3,867,341
-----------
Business & Public Services - 1.8%
28,775 Indigo NV (b)........................................ 79,131
95,344 Prosegur, CIA de Seguridad SA........................ 784,102
120,000 Ricoh Co. Ltd. (b)................................... 1,959,395
-----------
2,822,628
-----------
Chemicals - 6.3%
32,020 Akzo Nobel NV (b).................................... 1,382,146
38,280 BASF AG.............................................. 1,725,411
20,833 Burmah Castrol Plc................................... 359,255
165,000 Chugai Pharmaceutical Co. Ltd. (b)................... 1,964,003
21,813 DSM NV............................................... 827,947
43,000 Imperial Chemical Industries Plc..................... 428,014
7,760 Pannonplast RT....................................... 126,041
19,220 SGL Carbon AG........................................ 1,233,101
50,000 Shin Etsu Chemical Co. Ltd .......................... 2,063,835
-----------
10,109,753
-----------
Construction - 2.3%
11,215 Acciona SA........................................... 541,563
840,000 Okumura Corp. ....................................... 3,023,758
70,000 Shui On Construction &
Materials Ltd. ..................................... 97,310
-----------
3,662,631
-----------
</TABLE>
61
<PAGE>
EVERGREEN
Perpetual International Fund
(formerly Mentor Perpetual International Portfolio)
Schedule of Investments(continued)
October 31, 1999
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - continued
Data Processing & Reproduction - 0.9%
11,604 * Atos SA........................................... $ 1,490,183
-----------
Electrical & Electronics - 6.2%
11,922 Carbone Lorraine SA................................. 514,237
5,440 Centrais Eletricas Brasileiras, Cl. B............... 48,630
1,450 Chilectra SA, ADR................................... 25,785
40,000 Electricity Generating Public Co. .................. 52,843
15,728 Entrelec Groupe SA.................................. 762,809
7,500 Funai Electric Co. Ltd. ............................ 3,398,128
280,000 Furukawa Electric Co. Ltd. ......................... 2,042,717
17,799 Philips Electronics NV.............................. 1,829,721
490 Samsung Electronics Ltd., GDR, 144A................. 41,405
3,575 * Samsung Electronics Ltd., GDR, 144A, non-voting
shares............................................. 209,137
10,540 Schneider SA........................................ 727,891
28,500 Scottish Power Plc.................................. 263,772
800 Tata Electric Companies, GDR........................ 132,000
-----------
10,049,075
-----------
Electronic Components - 3.5%
37,017 ELMOS Semiconductor AG.............................. 936,693
19,000 Epcos AG............................................ 780,872
36,000 Halma Plc........................................... 63,915
5,800 Hon Hai Precision Industry Co., Ltd. ............... 95,004
80,000 Johnson Electric Holdings Ltd. ..................... 432,488
30,000 Kyocera Corp. ...................................... 2,879,770
20,193 Smiths Industries Plc............................... 274,193
3,628 Taiwan Semiconductor Manufacturing Co. Ltd. (b)..... 125,619
-----------
5,588,554
-----------
Energy Equipment &
Services - 0.1%
8,000 BSES Ltd. .......................................... 94,000
-----------
Energy Sources - 3.7%
55,000 British-Borneo Oil & Gas Plc........................ 145,567
8,325 Coflexip SA (b)..................................... 658,310
46,000 Enterprise Oil Plc.................................. 327,432
3,540 Perez Companc SA, ADR (b)........................... 42,997
4,300 Petroleo Brasileiro SA, ADR ("Petrobras") (b)....... 68,728
47,810 Petroleum Geo-Services.............................. 714,247
120,000 Shell Transportation & Trading Co. Plc.............. 919,268
22,440 Total Fina SA, Cl. B................................ 3,040,259
-----------
5,916,808
-----------
Financial Services - 4.5%
54,000 Abs CBN Holdings Corp. ............................. 59,252
500,000 Aeon Credit Service Co. Ltd. ....................... 205,947
5,000 Atlantic Korean Smaller Country Fund................ 68,750
50,994 Dah Sing Financial Group............................ 204,790
22,600 Garban Plc.......................................... 74,676
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - continued
Financial Services - continued
28,000 Haci Omer Sabanci Holdings SA........................ $ 201,600
120,000 Hong Leong Finance................................... 221,005
42,000 III Group Plc........................................ 524,732
49,930 Invesco English and International Trust Plc.......... 143,640
100,000 Irish Life & Permanent Plc........................... 1,010,998
50,000 Jardine Strategic Holdings Ltd. ..................... 110,500
130,000 Kokusai Securities Co. Ltd. (b)...................... 2,244,972
28,800 Konecranes Finance Oyj............................... 743,949
123,300 Medeva Plc........................................... 314,174
18,600 P & O Finance BV..................................... 267,544
25,640 Prudential Corp. Plc................................. 402,107
100,837 Schroder Uts Ltd. ................................... 68,843
400 Taipei Fund.......................................... 35,800
26,000 Taiwan Opportunities Fund LT......................... 282,100
57,428 The Throgmorton Trust Plc............................ 73,872
-----------
7,259,251
-----------
Food & Household Products - 6.2%
320,000 Asahi Glass Co. Ltd. ................................ 2,546,484
1,200,000 Cafe De Coral Holdings............................... 505,857
2,250 Chipita International Plc............................ 74,701
72,310 Grupo Editoriale L'Espresso.......................... 1,574,357
17,400 Huhtamaki Group...................................... 550,371
38,250 Iceland Group Plc.................................... 182,035
17,647 Jeronimo Martins SGPS SA............................. 493,806
957 Nestle SA............................................ 1,849,093
90,000 Northern Foods Plc................................... 140,553
244,000 PT Indofood Sukses Makmur Tbk........................ 288,947
22,100 Reckitt & Colman Plc................................. 268,117
25,000 Safeway Plc.......................................... 78,907
64,700 Sainsbury (J.) Plc................................... 388,747
25,775 Tate & Lyle Plc...................................... 168,850
114,400 Tesco Plc............................................ 339,922
51,000 Unilever Plc......................................... 473,689
14,932 Viscofan Envolturas Celuosicas SA (b)................ 122,642
-----------
10,047,078
-----------
Forest Products & Paper - 3.8%
36,200 Empresa Nacional de Celulosas SA (b)................. 679,381
350,000 Oji Paper Co. Ltd. .................................. 2,469,402
27,700 Siam Pulp & Paper.................................... 58,119
109,918 Stora Enso Oyj....................................... 1,448,650
45,030 UPM-Kymmene Oyj...................................... 1,424,321
-----------
6,079,873
-----------
Health & Personal Care - 3.0%
65,000 Body Shop International Plc.......................... 124,484
290,000 British Biotech...................................... 138,252
24,000 * Celltech Plc....................................... 179,514
3,600,000 Dankos Labs.......................................... 447,368
3,080 EGIS Gyogyszergyar RT................................ 91,821
55,674 * Elan Corp. Plc, ADR................................ 1,433,606
2,800 Gedeon Richter, GDR.................................. 127,762
3,807 Novartis AG.......................................... 376,422
</TABLE>
62
<PAGE>
EVERGREEN
Perpetual International Fund
(formerly Mentor Perpetual International Portfolio)
Schedule of Investments (continued)
October 31, 1999
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - continued
Health & Personal Care - continued
9,005 Novo Nordisk AS, Ser. B.............................. $ 1,083,024
37,800 Nycomed Amersham Plc................................. 232,401
32,148 PowderJect Pharmaceuticals Plc....................... 421,199
65,000 Scotia Holdings Plc.................................. 160,280
-----------
4,816,133
-----------
Industrial Components - 1.0%
8,730 Compagnie de Saint Gobain............................ 1,518,738
53,000 Cookson Group Plc.................................... 162,822
-----------
1,681,560
-----------
Insurance - 1.4%
21,000 Britannic Assurance Plc.............................. 375,598
21,917 Fortis (B)........................................... 741,773
55,000 Legal & General Group Plc............................ 152,800
400,000 Pacific Century...................................... 303,771
46,440 Sun Life & Provincial Holdings Plc................... 346,787
15,000 United Assurance Group............................... 1,849
44,150 United Assurance Group CNV........................... 283,055
-----------
2,205,633
-----------
Leisure & Tourism - 0.5%
70,000 First Choice Holidays Plc............................ 133,485
38,500 Greenalls Group Plc.................................. 196,199
75,941 Hilton Group Plc..................................... 232,201
62,000 Rank Group........................................... 193,142
50,000 Tanjong Plc.......................................... 105,263
-----------
860,290
-----------
Machinery & Engineering - 2.5%
25,645 BBA Group Plc........................................ 179,171
98,720 Elexis AG............................................ 603,695
7,639 Mannesmann AG........................................ 1,204,099
83,000 Meggitt Plc.......................................... 207,394
41,480 Metra AB Oyj (b)..................................... 787,220
39,000 Sembcorp Industries Ltd. ............................ 49,293
23,000 Spirax-Sarco Engineering Plc......................... 176,193
543 Sulzer AG............................................ 381,842
40,500 TI Group Plc......................................... 272,969
30,000 Tomkins Plc.......................................... 101,563
3,200 Tubos de Acero de Mexico SA.......................... 34,375
54,000 UMW Holdings Berhad.................................. 95,921
-----------
4,093,735
-----------
Merchandising - 1.6%
53,750 Arcadia Group Plc.................................... 135,190
44,800 Cifra SA de CV, Ser. V............................... 70,304
32,400 D.F.S. Furniture Co. Plc............................. 148,069
50,000 Debenhams Retail Plc................................. 212,063
17,000 Dixons Group Plc..................................... 301,261
28,300 Great University Stores Plc.......................... 214,468
56,026 Next Plc............................................. 604,643
46,650 Smith (H.W.) Group Plc............................... 340,878
20,000 Vendex International NV.............................. 585,164
-----------
2,612,040
-----------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - continued
Metals - Non Ferrous - 0.7%
18,870 Pechiney SA.......................................... $ 1,058,445
-----------
Metals - Steel - 1.2%
2,020 Companhia Vale do Rio Doce, ADR...................... 39,396
4,000 Hindalco Industries Ltd., GDR, 144A.................. 83,000
14,000 Pohang Iron & Steel Ltd., ADR (b).................... 467,250
101,910 Usinor SA (b)........................................ 1,419,398
-----------
2,009,044
-----------
Mining - 2.6%
26,320 Eramet SLN........................................... 1,343,123
265,000 Nippon Mining & Metals Co., Ltd. (b)................. 2,037,581
32,050 Rio Tinto Plc........................................ 547,417
596,000 Yanzhou Coal Mining Co. Ltd. ........................ 197,542
-----------
4,125,663
-----------
Multi-Industry - 3.3%
21,200 ALFA SA de CV, Ser. A................................ 81,192
10,000 Boustead Holdings Berhad............................. 7,895
175,000 First Pacific Co. Ltd. .............................. 101,364
33,800 Granada Group Plc.................................... 268,373
5,290 Grupo Carso SA de CV, ADR (b)........................ 44,154
60,000 Hutchison Whampoa Ltd. .............................. 602,394
15,000 Larsen & Toubro Ltd., GDS............................ 319,500
37,750 Securicor Plc........................................ 369,240
16,619 Siemens AG........................................... 1,495,523
25,874 Vivendi (b).......................................... 1,965,541
-----------
5,255,176
-----------
Real Estate - 1.9%
360,000 Amoy Properties Ltd. (b)............................. 310,465
20,000 Bukit Sembawang Estates, Ltd. ....................... 182,967
75,000 Burford Holdings Plc................................. 124,525
21,000 Chelsfield Plc....................................... 112,196
60,000 Cheung Kong Holdings Ltd. ........................... 546,402
70,000 Countrywide Associated............................... 170,308
125,000 DBS Land, Ltd. ...................................... 231,718
92,500 Fairview Holdings Plc................................ 208,323
1,414,000 Filinvest Development Corp. ......................... 88,155
19,000 Frogmore Estates Plc................................. 145,238
432,800 HKR International Ltd. .............................. 328,681
1,100 Inversiones y Representaciones, SA GDR............... 33,206
30,000 Land Securities Plc.................................. 373,823
25,000 Sun Hung Kai Properties Ltd. ........................ 202,729
-----------
3,058,736
-----------
Technology - 2.2%
236,000 Cse Systems & Engineering............................ 170,449
7,000 Fundtech Ltd. (b).................................... 93,625
80 Intralot SA.......................................... 2,044
24,621 Nokia AB Oyj......................................... 2,824,614
10,300 Ritek Corp. ......................................... 137,505
5,000 Synnex Technology International Corp., GDR........... 97,500
</TABLE>
63
<PAGE>
EVERGREEN
Perpetual International Fund
(formerly Mentor Perpetual International Portfolio)
Schedule of Investments(continued)
October 31, 1999
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - continued
Technology - continued
12,200 Synnex Technology International Corp., GDR,
Temporary Shares................................. $ 240,706
-----------
3,566,443
-----------
Telecommunications - 4.6%
72,000 Asia Satellite Telecommunications Holdings, Ltd. . 169,597
164,991 Cable & Wireless Hong Kong Ltd. .................. 376,958
11,000 Carso Global Telecom.............................. 73,067
273,000 China Telecom (Hong Kong) Ltd. (b)................ 932,958
1,130 Compania de Telecom de Chile SA, ADR.............. 18,857
4,715 Eesti Telekom..................................... 74,733
1,300 * Embratel Participacoes SA, ADR (b)................ 16,738
61,520 Ericsson LM Telephone, Ser B...................... 2,565,897
33,420 * Global TeleSystems Group, Inc. (b)................ 799,991
4,166 Hellenic Telecommunications Organization SA, GDR.. 88,483
5,000 Korea Telecom Corp. .............................. 176,250
16,000 Mahanagar Telep Ni, GDR........................... 128,000
47,000 Singapore Telecom................................. 89,389
3,450 STET Hellas Telecommunications SA................. 74,175
600 Tele Centro Sul Participacoes SA, ADR (b)......... 35,850
2,750 Tele Norte Leste Participacoes SA, ADR (b)........ 46,406
1,600 Telecom Argentina - France Telecom SA, Cl. B, ADR
(b).............................................. 44,000
740 * Telecomunicacoes Brasileiras SA, ADR, Preference
Shares ("Telebras") (b).......................... 57,627
84,774 * Telefonica SA..................................... 1,397,926
2,340 Telefonos de Mexico SA, ADR (b)................... 200,070
1,900 Telesp Celular Participacoes (b).................. 46,787
2,600 Telesp Participacpoes SA, ADR (b)................. 42,088
-----------
7,455,847
-----------
Textiles - 1.5%
115,000 Coats Viyella Plc................................. 88,380
450,000 Teijin, Ltd. ..................................... 2,298,056
-----------
2,386,436
-----------
Transportation - Airlines - 1.5%
62,800 British Airways Plc............................... 321,067
96,000 Lufthansa AG...................................... 2,024,351
-----------
2,345,418
-----------
Transportation - Roads & Rail - 1.8%
45,150 Arriva Plc........................................ 237,511
300,000 Nippon Express Co. Ltd. .......................... 2,125,270
17,600 Railtrack Group Plc............................... 360,500
53,000 Stagecoach Holdings............................... 150,729
-----------
2,874,010
-----------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - continued
Transportation - Shipping - 0.7%
27,999 Associated British Ports Holdings Plc............. $ 139,003
23,280 IHC Caland NV..................................... 1,012,492
-----------
1,151,495
-----------
Utilities - Electric, Gas &
Water - 2.3%
42,000 BG Plc............................................ 233,368
2,332 Companhia Energetica de Minas Gerais, ADR......... 33,331
5,100 Companhia Paranaense de Energia-Copel, Plc, ADR... 33,787
1,900 Empresa Nacional de Electric, ADR (b)............. 24,225
3,600 Isis.............................................. 241,783
65,000 National Power Plc................................ 441,305
28,000 Powergen Plc...................................... 247,177
32,000 Scot & Southern Energy Plc........................ 304,055
23,895 United Utilities Plc.............................. 236,864
35,490 Veba AG........................................... 1,923,330
-----------
3,719,225
-----------
Wholesale & International
Trade - 2.1%
65,000 Aoyama Trading Co................................. 2,077,754
1,900 * AVA Allg Handels der Verbraucher AG............... 875,426
11,666 Inchcape Plc...................................... 58,108
482,750 Signet Group Plc.................................. 416,636
-----------
3,427,924
-----------
Total Common Stocks
(cost $137,968,232).............................. 155,725,774
-----------
PREFERRED STOCKS - 1.3%
Automobiles - 0.9%
560 Porsche AG........................................ 1,529,229
-----------
Chemicals - 0.4%
8,932 Henkel KGaA....................................... 607,425
-----------
Total Preferred Stocks
(cost $1,908,351)................................ 2,136,654
-----------
WARRANTS - 0.1%
Banking - 0.1%
200,000 Deutsche Bank AG, expire 3/28/2002................ 153,476
-----------
Building Materials & Components - 0.0%
9,200 * United Engineers Ltd. Berhad,
expire 11/22/2002(d)............................. 0
-----------
Total Warrants
(cost $103,050).................................. 153,476
-----------
</TABLE>
64
<PAGE>
EVERGREEN
Perpetual International Fund
(formerly Mentor Perpetual International Portfolio)
Schedule of Investments(continued)
October 31, 1999
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
CORPORATE BONDS - 0.0%
Chemicals - 0.0%
32,750 Burmah Castrol Plc
4.85%, 11/30/1999................................... $ 53,838
-----------
Health & Personal Care - 0.0%
19,000 Scotia Holdings
8.50%, 3/26/2002.................................... 25,768
-----------
Total Corporate Bonds
(cost $85,496)...................................... 79,606
-----------
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
SHORT-TERM INVESTMENTS - 13.3%
Money Market Portfolio - 10.7%
$17,284,173 Navigator Prime Portfolio - 10.7%
(cost $17,284,173) (c)............................. $17,284,173
-----------
Repurchase Agreement - 2.6%
4,134,251 State Street Bank & Trust Co. purchased 10/29/1999,
5.16%, maturing 11/1/1999, maturity value
$4,136,029
(cost $4,134,251) (a).............................. 4,134,251
-----------
Total Short-Term Investments
(cost $21,418,424)................................. 21,418,424
-----------
</TABLE>
<TABLE>
<C> <S> <C> <C>
Total Investments -
(cost $161,483,553)........................ 111.5% 179,513,934
Other Assets and
Liabilities - net.......................... (11.5) (18,571,975)
----- ------------
Net Assets.................................. 100.0% $160,941,959
===== ============
</TABLE>
(a) The repurchase agreement is fully collateralized by U.S. government and/or
agency obligations based on market prices plus accrued interest at
October 31, 1999.
(b) All or a portion of this security is on loan.
(c) Represents investment of cash collateral received for securities on loan.
(d) Investment is being fair valued in accordance with procedures established
by the Board of Trustees.
* Non-income producing security.
144A Security that may be resold to "qualified institutional buyers" under Rule
144A of the Securities Act of 1933. This security has been determined to
be liquid under guidelines established by the Board of Trustees.
Summary of Abbreviations:
ADR American Depository Receipt
GDR Global Depository Receipt
At October 31, 1999, the Fund held securities in the following countries:
<TABLE>
<CAPTION>
Percentage of
Market Value Portfolio Assets
- --------------------------------------------------------------------------------
<S> <C> <C>
Japan............................................. $ 41,199,375 23.0%
United Kingdom.................................... 30,293,219 16.9%
United States+.................................... 22,132,229 12.3%
Germany........................................... 17,282,630 9.6%
France............................................ 15,899,322 8.9%
Finland........................................... 7,839,475 4.4%
Netherlands....................................... 7,250,455 4.0%
Hong Kong......................................... 6,220,401 3.5%
Spain............................................. 4,803,410 2.7%
Sweden............................................ 4,579,161 2.6%
Switzerland....................................... 3,632,183 2.0%
Singapore......................................... 2,393,168 1.3%
Ireland........................................... 1,775,023 1.0%
Italy............................................. 1,574,356 0.9%
Indonesia......................................... 1,569,854 0.9%
Other............................................. 11,069,673 6.0%
------------ ------
$179,513,934 100.0%
============ ======
</TABLE>
+ Includes short-term securities.
See Combined Notes to Financial Statements.
65
<PAGE>
EVERGREEN
Precious Metals Fund
Schedule of Investments
October 31, 1999
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - 96.5%
Gold Mining - 55.5%
80,819 AngloGold Ltd. ..................................... $ 4,564,707
2,074,000 * Avgold Ltd. ...................................... 1,400,964
275,000 Battle Mountain Gold Co............................. 739,063
231,550 Cambior, Inc........................................ 353,956
1,100,000 Delta Gold NL....................................... 1,858,895
618,113 Franco Nevada Mining Ltd. .......................... 11,464,423
100,000 * Goldcorp, Inc., Cl. A............................. 631,250
301,700 * Goldcorp, Inc., Cl. A - Canadian Exchange......... 1,947,245
758,504 Goldfields Ltd. .................................... 3,629,737
262,000 * Greenstone Resources Ltd. ........................ 24,030
380,500 Homestake Mining Co. ............................... 3,186,688
910,000 * Kinross Gold Corp. ............................... 2,331,875
200,000 * Kinross Gold Corp. - Canadian Exchange............ 509,546
800,000 * Lihir Gold Ltd. .................................. 658,106
596,500 * Meridian Gold, Inc. .............................. 4,250,063
140,000 * Meridian Gold, Inc. - Canadian Exchange........... 1,012,976
100,000 Newcrest Mining..................................... 281,226
1,084,824 Normandy Mining Ltd. ............................... 823,233
337,100 * Orvana Minerals Corp. ............................ 91,609
122,500 Placer Dome, Inc. .................................. 1,485,313
65,000 Placer Dome, Inc. - Canadian Exchange............... 816,971
531,000 Queenstake Resources Ltd. Yukon..................... 66,740
106,000 * Rio Narcea Gold Mine, Inc. ....................... 133,949
1,020,629 Ross Mining NL...................................... 279,868
499,600 Sons of Gwalia Ltd. ................................ 1,449,606
857,500 * TVX Gold, Inc. ................................... 821,438
1,000,000 * Viceroy Resource Corp. ........................... 747,333
288,585 * Western Areas Gold Mining Ltd., ADR............... 873,489
------------
46,434,299
------------
Metals & Mining - 41.0%
1,799,200 Acacia Resources Ltd. .............................. 3,189,632
117,800 Anglo-American Platinum Corp. Ltd. ................. 3,393,818
90,000 Barrick Gold Corp. ................................. 1,648,125
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - continued
Metals & Mining - continued
143,700 Barrick Gold Corp. - Canadian Exchange.............. $ 2,640,862
1,999,000 * Canyon Resources Corp. ........................... 624,688
80,000 De Beers Centenary.................................. 2,185,003
991,400 Gencor Ltd. ........................................ 3,679,203
800,000 * Geomaque Exploration Ltd. ........................ 369,590
850,200 Harmony Gold Mining Ltd. ........................... 5,570,023
105,000 Impala Platinum Holdings Ltd. ...................... 3,636,896
130,400 Newmont Mining Corp. ............................... 2,860,650
135,000 * Randgold Resources, Inc., GDR..................... 540,000
300,000 * Repadre Capital Corp. ............................ 407,636
72,300 * SouthernEra Resources Ltd. ....................... 107,082
169,250 * Stillwater Mining Co. ............................ 3,406,157
------------
34,259,365
------------
Total Common Stocks (cost $91,034,273).............. 80,693,664
------------
WARRANTS - 0.0%
Metals & Mining - 0.0%
227,500 * Atlas Corp., Expire 12/15/1999.................... 0
429,000 * Vengold, Inc., Ser. B, Expire 6/13/2000........... 1,457
------------
Total Warrants
(cost $294,417).................................... 1,457
------------
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C> <C>
SHORT-TERM INVESTMENTS - 0.8%
Repurchase Agreement - 0.8%
$ 691,000 Evergreen Joint Repurchase Agreement, Investments in
a joint trading account, purchased 10/29/1999,
5.25%, maturing 11/1/1999, maturity value $691,302
(cost $691,000) (a)................................. $ 691,000
------------
Total Investments - (cost $92,019,690)....... 97.3% 81,386,121
Other Assets and Liabilities - net........... 2.7 2,246,671
------ ------------
Net Assets................................... 100.0% $ 83,632,792
====== ============
</TABLE>
(a) The repurchase agreement is fully collateralized by U.S. government
and/or agency obligations based on market prices plus accrued
interest at October 31, 1999.
* Non-income producing security.
Summary of Abbreviations
ADR American Depository Receipt
GDR Global Depository Receipt
66
<PAGE>
EVERGREEN
Precious Metals Fund
Schedule of Investments(continued)
October 31, 1999
At October 31, 1999, the Fund held securities in the following countries:
<TABLE>
<CAPTION>
Percentage of
Market Value Portfolio Assets
- --------------------------------------------------------------------------------
<S> <C> <C>
Canada............................................ $31,863,472 39.2%
South Africa...................................... 29,473,840 36.2%
United States+.................................... 11,508,244 14.1%
Australia......................................... 7,882,459 9.7%
Papua New Guinea.................................. 658,106 0.8%
----------- ------
$81,386,121 100.0%
=========== ======
</TABLE>
+ Includes short-term securities.
See Combined Notes to Financial Statements.
67
<PAGE>
EVERGREEN
International and Global Growth Funds
Statements of Assets and Liabilities
October 31, 1999
<TABLE>
<CAPTION>
Emerging Global Global International Latin Perpetual Precious
Markets Growth Leaders Opportunities Growth America International Metals
Fund Fund Fund Fund Fund Fund (a) Fund
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Assets
Identified cost of
securities........... $ 57,383,519 $322,868,619 $148,850,169 $596,278,624 $ 24,364,475 $161,483,553 $ 92,019,690
Net unrealized gains
or losses on
securities........... 6,682,158 120,421,094 52,405,021 101,655,819 5,268,298 18,030,381 (10,633,569)
- -----------------------------------------------------------------------------------------------------------------------------
Market value of
securities........... 64,065,677 443,289,713 201,255,190 697,934,443 29,632,773 179,513,934 81,386,121
Investment in wholly-
owned, unconsolidated
foreign subsidiary,
at value............. 0 0 0 0 0 0 863,952
Cash.................. 3,643 694 509 0 513 0 5,836
Foreign currency, at
value (cost $726,063,
$843,630, $66,
$15,100, $8,973,
$127,335 and $0,
respectively)........ 725,589 843,630 66 15,089 8,134 128,623 0
Receivable for
securities sold...... 112,290 0 3,732,176 365,865 30,499 716,998 1,446,595
Receivable for Fund
shares sold.......... 724,526 2,034,600 479,671 2,926,167 21,757 615,755 2,952
Dividends and interest
receivable........... 48,901 493,123 207,140 1,516,989 96,559 384,433 21,791
Deferred organization
expenses............. 0 7,980 0 0 0 7,718 0
Prepaid expenses and
other assets......... 21,417 47,284 42,453 109,071 20,908 99,544 81,965
- -----------------------------------------------------------------------------------------------------------------------------
Total assets.......... 65,702,043 446,717,024 205,717,205 702,867,624 29,811,143 181,467,005 83,809,212
- -----------------------------------------------------------------------------------------------------------------------------
Liabilities
Payable for securities
purchased............ 318,750 0 4,499,831 1,584,245 0 1,852,307 0
Payable for Fund
shares redeemed...... 25,905 387,393 579,856 452,312 170,408 1,024,586 29,248
Payable for closed
forward foreign
currency exchange
contracts............ 0 0 113,213 629,150 0 0 0
Payable for securities
on loan.............. 0 0 15,173,743 0 0 17,284,173 0
Unrealized losses on
forward foreign
currency exchange
contracts............ 0 955,102 0 0 0 0 0
Due to custodian
bank................. 0 0 0 11,591 0 0 0
Advisory fee payable.. 81,258 328,703 151,739 364,265 18,209 133,387 58,133
Distribution Plan
expenses payable..... 4,117 102,736 104,904 49,778 12,656 68,963 21,251
Due to other related
parties.............. 1,219 8,368 0 32,313 0 0 0
Accrued expenses and
other liabilities.... 32,881 167,991 100,178 286,472 17,648 161,630 67,788
- -----------------------------------------------------------------------------------------------------------------------------
Total liabilities..... 464,130 1,950,293 20,723,464 3,410,126 218,921 20,525,046 176,420
- -----------------------------------------------------------------------------------------------------------------------------
Net assets............. $ 65,237,913 $444,766,731 $184,993,741 $699,457,498 $ 29,592,222 $160,941,959 $ 83,632,792
- -----------------------------------------------------------------------------------------------------------------------------
Net assets represented
by
Paid-in capital....... $ 69,759,801 $318,396,835 $ 98,456,109 $587,549,489 $ 50,574,513 $126,587,838 $185,924,248
Undistributed
(overdistributed) net
investment income
(loss)............... (1,984) (17,414) (14,180) 10,468,197 (3,414) 0 (3,594)
Accumulated net
realized gains or
losses on securities,
futures contracts and
foreign currency
related
transactions......... (11,197,105) 6,919,132 34,262,939 (213,184) (26,243,308) 16,305,925 (91,655,143)
Net unrealized gains
or losses on
securities and
foreign currency
related
transactions......... 6,677,201 119,468,178 52,288,873 101,652,996 5,264,431 18,048,196 (10,632,719)
- -----------------------------------------------------------------------------------------------------------------------------
Total net assets....... $ 65,237,913 $444,766,731 $184,993,741 $699,457,498 $ 29,592,222 $160,941,959 $ 83,632,792
- -----------------------------------------------------------------------------------------------------------------------------
Net assets consists of
Class A............... $ 8,390,209 $185,805,684 $ 53,532,602 $127,601,592 $ 4,852,918 $ 93,577,839 $ 69,387,096
Class B............... 3,452,499 207,432,858 111,267,077 63,927,693 20,752,220 247,893 13,781,119
Class C............... 1,023,508 4,485,578 19,963,201 2,349,374 3,717,247 60,544,037 464,577
Class Y............... 52,371,697 47,042,611 230,861 505,578,839 269,837 6,572,190 --
- -----------------------------------------------------------------------------------------------------------------------------
Total net assets....... $ 65,237,913 $444,766,731 $184,993,741 $699,457,498 $ 29,592,222 $160,941,959 $ 83,632,792
- -----------------------------------------------------------------------------------------------------------------------------
Shares outstanding
Class A............... 900,548 10,123,724 2,052,748 14,627,465 579,041 5,082,233 5,842,207
Class B............... 383,206 11,574,822 4,514,402 7,415,921 2,570,521 13,367 1,175,794
Class C............... 113,476 250,703 808,186 272,540 461,285 3,342,661 39,668
Class Y............... 5,564,464 2,537,787 8,814 57,921,871 32,044 354,087 --
- -----------------------------------------------------------------------------------------------------------------------------
Net asset value per
share
Class A............... $ 9.32 $ 18.35 $ 26.08 $ 8.72 $ 8.38 $ 18.41 $ 11.88
- -----------------------------------------------------------------------------------------------------------------------------
Class A--Offering
price (based on sales
charge of 4.75%)..... $ 9.78 $ 19.27 $ 27.38 $ 9.15 $ 8.80 $ 19.33 $ 12.47
- -----------------------------------------------------------------------------------------------------------------------------
Class B............... $ 9.01 $ 17.92 $ 24.65 $ 8.62 $ 8.07 $ 18.55 $ 11.72
- -----------------------------------------------------------------------------------------------------------------------------
Class C............... $ 9.02 $ 17.89 $ 24.70 $ 8.62 $ 8.06 $ 18.11 $ 11.71
- -----------------------------------------------------------------------------------------------------------------------------
Class Y............... $ 9.41 $ 18.54 $ 26.19 $ 8.73 $ 8.42 $ 18.56 --
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>
(a) Formerly Mentor Perpetual International Portfolio.
See Combined Notes to Financial Statements.
68
<PAGE>
EVERGREEN
International and Global Growth Funds
Statements of Operations
Year Ended October 31, 1999
<TABLE>
<CAPTION>
Emerging
Markets Global Global International Latin Perpetual Precious
Growth Leaders Opportunities Growth America International Metals
Fund Fund Fund Fund Fund Fund (a) Fund
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Investment income
Dividends (net of
foreign withholding
taxes of $97,553,
$390,732, $197,788
$918,373, $70,684,
$364,306 and $0,
respectively)........ $ 995,337 $ 4,799,120 $ 1,557,203 $ 11,741,282 $ 868,549 $ 2,890,047 $ 1,659,640
Interest.............. 187,579 610,595 228,367 1,470,552 113,943 243,033 74,261
- -----------------------------------------------------------------------------------------------------------------------
Total investment
income................ 1,182,916 5,409,715 1,785,570 13,211,834 982,492 3,133,080 1,733,901
- -----------------------------------------------------------------------------------------------------------------------
Expenses
Advisory fee.......... 912,765 3,651,052 1,877,575 4,195,994 258,833 1,414,283 678,057
Distribution Plan
expenses............. 60,953 2,314,869 1,462,584 1,029,794 297,457 721,424 361,660
Administrative
services fees........ 14,912 94,269 26,349 106,380 4,434 141,826 13,832
Transfer agent fee.... 28,637 1,245,002 606,548 966,604 191,891 232,441 681,459
Trustees' fees and
expenses............. 1,233 7,644 3,757 13,300 704 3,117 1,798
Organization
expenses............. 8,616 7,891 0 0 4,597 2,982 0
Interest expense...... 0 516,634 20,919 12,651 785 0 31,378
Other................. 197,886 481,007 327,146 1,172,571 118,968 474,116 186,271
- -----------------------------------------------------------------------------------------------------------------------
Total expenses........ 1,225,002 8,318,368 4,324,878 7,497,294 877,669 2,990,189 1,954,455
Less: Fee credits..... (14,424) (29,542) (15,860) (33,220) (3,514) (1,623) (4,771)
Fee waivers and
expense
reimbursements..... 0 0 0 0 0 (68,420) 0
- -----------------------------------------------------------------------------------------------------------------------
Net expenses.......... 1,210,578 8,288,826 4,309,018 7,464,074 874,155 2,920,146 1,949,684
- -----------------------------------------------------------------------------------------------------------------------
Net investment income
(loss)............... (27,662) (2,879,111) (2,523,448) 5,747,760 108,337 212,934 (215,783)
- -----------------------------------------------------------------------------------------------------------------------
Equity in earnings of
wholly-owned,
unconsolidated
foreign subsidiary
and foreign currency
related
transactions......... 0 0 0 0 0 0 19,428
- -----------------------------------------------------------------------------------------------------------------------
Net realized and
unrealized gains or
losses on securities,
futures contracts
Net realized gains or
losses on:
Securities............ 5,077,593 8,886,995 38,502,663 41,238,340 (2,959,073) 17,925,207 (27,024,764)
Futures contracts..... 0 0 (437,174) 34,066 0 0 0
Foreign currency
related
transactions......... (571,914) (509,663) 758,035 4,676,578 (1,082,246) (1,056,622) (7,167)
- -----------------------------------------------------------------------------------------------------------------------
Net realized gains or
losses on securities,
futures contracts and
foreign currency
related
transactions......... 4,505,679 8,377,332 38,823,524 45,948,984 (4,041,319) 16,868,585 (27,031,931)
- -----------------------------------------------------------------------------------------------------------------------
Net change in
unrealized gains on
securities and
foreign currency
related
transactions......... 5,594,474 76,159,336 31,754,002 52,884,054 6,649,537 15,449,779 28,217,759
- -----------------------------------------------------------------------------------------------------------------------
Net realized and
unrealized gains on
securities, futures
contracts and foreign
currency related
transactions......... 10,100,153 84,536,668 70,577,526 98,833,038 2,608,218 32,318,364 1,185,828
- -----------------------------------------------------------------------------------------------------------------------
Net increase in net
assets resulting from
operations........... $10,072,491 $81,657,557 $68,054,078 $104,580,798 $ 2,716,555 $32,531,298 $ 989,473
- -----------------------------------------------------------------------------------------------------------------------
</TABLE>
(a) Formerly Mentor Perpetual International Portfolio.
See Combined Notes to Financial Statements.
69
<PAGE>
EVERGREEN
International and Global Growth Funds
Statements of Changes in Net Assets
Year Ended October 31, 1999
<TABLE>
<CAPTION>
Emerging
Markets Global Global International Latin Perpetual Precious
Growth Leaders Opportunities Growth America International Metals
Fund Fund Fund Fund Fund Fund (a) (b) (c) Fund
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Operations
Net investment
income (loss).. $ (27,662) $ (2,879,111) $ (2,523,448) $ 5,747,760 $ 108,337 $ 212,934 $ (215,783)
Equity in
earnings of
wholly-owned
unconsolidated
foreign
subsidiary..... 0 0 0 0 0 0 19,428
Net realized
gains or losses
on securities,
futures
contracts and
foreign
currency
related
transactions... 4,505,679 8,377,332 38,823,524 45,948,984 (4,041,319) 16,868,585 (27,031,931)
Net change in
unrealized
gains on
securities and
foreign
currency
related
transactions... 5,594,474 76,159,336 31,754,002 52,884,054 6,649,537 15,449,779 28,217,759
- ------------------------------------------------------------------------------------------------------------------------------
Net increase in
net assets
resulting from
operations..... 10,072,491 81,657,557 68,054,078 104,580,798 2,716,555 32,531,298 989,473
- ------------------------------------------------------------------------------------------------------------------------------
Distributions to
shareholders
from
Net investment
income
Class A......... (10,598) 0 0 0 0 0 0
Class B......... (4,073) 0 0 0 0 0 0
Class C......... (995) 0 0 0 0 0 0
Class Y......... (136,530) 0 0 0 0 0 0
Net realized
gains
Class A......... 0 0 (3,485,496) 0 0 0 0
Class B......... 0 0 (7,900,493) 0 0 0 0
Class C......... 0 0 (1,472,665) 0 0 0 0
Class Y......... 0 0 (1,957) 0 0 0 0
- ------------------------------------------------------------------------------------------------------------------------------
Total
distributions
to
shareholders... (152,196) 0 (12,860,611) 0 0 0 0
- ------------------------------------------------------------------------------------------------------------------------------
Capital share
transactions
Proceeds from
shares sold.... 44,051,855 2,630,916,446 136,044,293 301,153,523 26,101,038 166,034,604 87,565,275
Payment for
shares
redeemed....... (47,543,215) (2,622,732,751) (221,303,957) (341,962,909) (42,507,400) (155,946,116) (114,675,177)
Net asset value
of shares
issued in
reinvestment of
distributions.. 114,987 0 10,894,229 0 0 0 0
- ------------------------------------------------------------------------------------------------------------------------------
Net increase
(decrease) in
net assets
resulting from
capital share
transactions... (3,376,373) 8,183,695 (74,365,435) (40,809,386) (16,406,362) 10,088,488 (27,109,902)
- ------------------------------------------------------------------------------------------------------------------------------
Total increase
(decrease) in
net assets..... 6,543,922 89,841,252 (19,171,968) 63,771,412 (13,689,807) 42,619,786 (26,120,429)
Net assets
period......... 58,693,991 354,925,479 204,165,709 635,686,086 43,282,029 118,322,173 109,753,221
- ------------------------------------------------------------------------------------------------------------------------------
End of period... $ 65,237,913 $ 444,766,731 $ 184,993,741 $ 699,457,498 $ 29,592,222 $ 160,941,959 $ 83,632,792
- ------------------------------------------------------------------------------------------------------------------------------
Undistributed
(overdistributed)
net investment
income (loss)... $ (1,984) $ (17,414) $ (14,180) $ 10,468,197 $ (3,414) $ 0 $ (3,594)
- ------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(a) Formerly Mentor Perpetual International Portfolio.
(b) Effective October 18, 1999, shareholders of Mentor Perpetual International
Portfolio Class A, Class B and Class Y shares became owners of that number
of full and fractional shares of Class A, Class C and Class Y shares, re-
spectively, of Evergreen Perpetual International Fund. Class B shares of
Mentor Perpetual International Portfolio were redesignated as Class C
shares of Evergreen Perpetual International Fund.
(c) As a result of the conversion of Mentor Perpetual International Portfolio
to Evergreen Perpetual International Fund, the shareholders of Mentor Per-
petual International Portfolio, Class E, became owners of that number of
full and fractional shares of Evergreen Perpetual International Fund, Class
A, having a net asset value equal to the net asset value of their shares
immediately prior to the conversion of shares.
See Combined Notes to Financial Statements.
70
<PAGE>
EVERGREEN
International and Global Growth Funds
Statements of Changes in Net Assets
Year Ended October 31, 1998
<TABLE>
<CAPTION>
Emerging
Markets Global Global International Latin Perpetual Precious
Growth Leaders Opportunities Growth America International Metals
Fund Fund Fund Fund Fund Fund (a) (b) (c) Fund
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Operations
Net investment
income (loss).. $ 1,147,818 $ (1,983,258) $ (3,154,607) $ 1,682,972 $ 538,745 $ 760,153 $ (756,410)
Equity in
earnings of
wholly-owned
unconsolidated
foreign
subsidiary..... 0 0 0 0 0 0 24,179
Net realized
gains or losses
on securities,
futures
contracts and
foreign
currency
related
transactions... (16,618,543) 421,087 7,925,022 (26,164,161) (23,161,902) (1,408,584) (50,552,000)
Net change in
unrealized
gains or losses
on securities
and foreign
currency
related
transactions... 1,538,854 22,226,344 (33,746,429) 3,471,235 4,561,215 4,181,964 25,221,436
- ------------------------------------------------------------------------------------------------------------------------------
Net increase
(decrease) in
net assets
resulting from
operations..... (13,931,871) 20,664,173 (28,976,014) (21,009,954) (18,061,942) 3,533,533 (26,062,795)
- ------------------------------------------------------------------------------------------------------------------------------
Distributions to
shareholders
from
Net investment
income
Class A......... 0 0 0 0 0 (74,416)(c) 0
Class B......... 0 0 0 (5,718,223) 0 0 0
Class C......... 0 0 0 0 0 (52,551) 0
Class Y......... (48,897) 0 0 0 0 (26,033) 0
Net realized
gains
Class A......... (79,620) (165,467) (6,152,515) 0 (2,915,764) (91,708)(c) 0
Class B......... (102,137) (582,223) (14,270,759) (26,737,026) (16,639,668) 0 (5,647,344)
Class C......... (33,101) (10,308) (2,859,903) 0 (2,385,233) (54,364) 0
Class Y......... (1,528,035) (150,779) (2) 0 0 (51,028) 0
Tax return of
capital
Class A......... 0 0 0 0 0 (613,756)(c) 0
Class C......... 0 0 0 0 0 (404,533) 0
Class Y......... 0 0 0 0 0 (103,344) 0
- ------------------------------------------------------------------------------------------------------------------------------
Total
distributions
to
shareholders... (1,791,790) (908,777) (23,283,179) (32,455,249) (21,940,665) (1,471,733) (5,647,344)
- ------------------------------------------------------------------------------------------------------------------------------
Capital share
transactions
Proceeds from
shares sold.... 29,751,699 516,465,732 113,926,118 272,008,827 26,805,997 70,000,076 179,561,024
Payment for
shares
redeemed....... (25,828,310) (448,691,323) (236,427,456) (167,827,455) (62,999,696) (23,829,534) (193,454,892)
Net asset value
of shares
issued in
reinvestment of
distributions.. 1,273,339 804,394 20,555,694 28,410,070 19,625,500 1,395,920 4,759,767
Net asset value
of shares
issued in
acquisition.... 0 55,765,847 0 404,753,737 0 0 39,424,759
- ------------------------------------------------------------------------------------------------------------------------------
Net increase
(decrease) in
net assets
resulting from
capital share
transactions... 5,196,728 124,344,650 (101,945,644) 537,345,179 (16,568,199) 47,566,462 30,290,658
- ------------------------------------------------------------------------------------------------------------------------------
Total increase
(decrease) in
net assets.... (10,526,933) 144,100,046 (154,204,837) 483,879,976 (56,570,806) 49,628,262 (1,419,481)
Net assets
Beginning of
period......... 69,220,924 210,825,433 358,370,546 151,806,110 99,852,835 68,693,911 111,172,702
- ------------------------------------------------------------------------------------------------------------------------------
End of period... $ 58,693,991 $ 354,925,479 $ 204,165,709 $ 635,686,086 $ 43,282,029 $118,322,173 $ 109,753,221
- ------------------------------------------------------------------------------------------------------------------------------
Undistributed
(overdistributed)
net investment
income (loss)... $ 146,019 $ (12,989) $ 2,263,614 $ 8,260,101 $ (3,551) $ 53 $ (3,368)
- ------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(a) Formerly Mentor Perpetual International Portfolio.
(b) Effective October 18, 1999, shareholders of Mentor Perpetual International
Portfolio Class A, Class B and Class Y shares became owners of that number
of full and fractional shares of Class A, Class C and Class Y shares, re-
spectively, of Evergreen Perpetual International Fund. Class B shares of
Mentor Perpetual International Portfolio were redesignated as Class C
shares of Evergreen Perpetual International Fund.
(c) As a result of the conversion of Mentor Perpetual International Portfolio
to Evergreen Perpetual International Fund, the shareholders of Mentor Per-
petual International Portfolio, Class E, became owners of that number of
full and fractional shares of Evergreen Perpetual International Fund, Class
A, having a net asset value equal to the net asset value of their shares
immediately prior to the conversion of shares.
See Combined Notes to Financial Statements.
71
<PAGE>
Combined Notes to Financial Statements
1. ORGANIZATION
The Evergreen International and Global Growth Funds consist of Evergreen Emerg-
ing Markets Growth Fund ("Emerging Markets Growth Fund"), Evergreen Global
Leaders Fund ("Global Leaders Fund"), Evergreen Global Opportunities Fund
("Global Opportunities Fund"), Evergreen International Growth Fund ("Interna-
tional Growth Fund"), Evergreen Latin America Fund ("Latin America Fund"), Ev-
ergreen Perpetual International Fund ("Perpetual International Fund") (formerly
Mentor Perpetual International Portfolio) and Evergreen Precious Metals Fund
("Precious Metals Fund") (collectively, the "Funds"). Each Fund is a diversi-
fied series of Evergreen International Trust (the "Trust"), a Delaware business
trust organized on September 18, 1997. The Trust is an open-end management in-
vestment company registered under the Investment Company Act of 1940, as
amended (the "1940 Act"). Prior to October 18, 1999, the Perpetual Interna-
tional Fund was a diversified series of Mentor Institutional Trust, a Massachu-
setts business trust, organized on February 8, 1994 as an open-end management
investment company and registered under the 1940 Act.
All Funds offer Class A, Class B, Class C, and/or Class Y shares. Class A
shares are sold with a maximum front-end sales charge of 4.75%. Class B and
Class C shares are sold without a front-end sales charge, but pay a higher on-
going distribution fee than Class A. Class B shares are sold subject to a con-
tingent deferred sales charge that is payable upon redemption and decreases de-
pending on how long the shares have been held. Class B shares purchased after
January 1, 1997 will automatically convert to Class A shares after seven years.
Class B shares purchased prior to January 1, 1997 follow the conversion rights
at the time the shares were purchased. Class C shares are sold subject to a
contingent deferred sales charge payable on shares redeemed within one year af-
ter the month of purchase. Class Y shares are sold at net asset value and are
not subject to contingent deferred sales charges or distribution fees. Class Y
shares are sold only to investment advisory clients of First Union Corporation
("First Union") and its affiliates, certain institutional investors or Class Y
shareholders of record of certain other funds managed by First Union and its
affiliates as of December 30, 1994.
As a result of the conversion of Mentor Perpetual International Portfolio on
October 18, 1999 into the Trust, the shareholders of Class A, Class B and Class
Y of Mentor Perpetual International Portfolio became owners of that number of
full and fractional shares of Class A, Class C and Class Y shares, respective-
ly, of the Evergreen Perpetual International Fund. Shareholders of Class C
shares received in the conversion are subject to the schedule of contingent de-
ferred sales charges applicable to Class B shares of Mentor Perpetual Interna-
tional Portfolio. In addition, effective October 18, 1999, the Fund added a new
class of shares designated as Class B.
As a result of the conversion of Mentor Perpetual International Portfolio to
Evergreen Perpetual International Fund, the shareholders of Mentor Perpetual
International Portfolio, Class E, became owners of that number of full and
fractional shares of Evergreen Perpetual International Fund, Class A, having a
net asset value equal to the net asset value of their shares immediately prior
to the conversion of shares.
Prior to October 18, 1999, Class A shares of the Evergreen Perpetual Interna-
tional Fund were sold with a maximum front-end sales charge of 5.75% payable at
the time of purchase.
2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently fol-
lowed by the Funds in the preparation of their financial statements. The poli-
cies are in conformity with generally accepted accounting principles, which re-
quire management to make estimates and assumptions that affect amounts reported
herein. Actual results could differ from these estimates.
A. Valuation of Securities
Securities traded on an established exchange or on the Nasdaq National Market
System ("NMS") are valued on the basis of the last sales price on the exchange
where the security is primarily traded. Securities traded in
72
<PAGE>
Combined Notes to Financial Statements (continued)
the over-the-counter market are valued on the basis of the last sales price.
Securities traded on an exchange or NMS and other securities traded in the
over-the-counter market for which there has been no sale are valued at the mean
between the last reported bid and asked price. Securities for which market quo-
tations are not readily available, including restricted securities, are valued
at fair value as determined in good faith according to procedures approved by
the Board of Trustees. Short-term investments with remaining maturities of 60
days or less are carried at amortized cost, which approximates market value.
Mutual fund shares are valued at the net asset value of each mutual fund.
B. Repurchase Agreements
Each Fund may invest in repurchase agreements. Securities pledged as collateral
for repurchase agreements are held in a segregated account by the custodian on
the Fund's behalf. Collateral for certain tri-party repurchase agreements is
held at the counterparty's custodian in a segregated account for the benefit of
the Fund and the counterparty. Each Fund monitors the adequacy of the collat-
eral daily and will require the seller to provide additional collateral in the
event the market value of the securities pledged falls below the carrying value
of the repurchase agreement, including accrued interest. Each Fund will only
enter into repurchase agreements with banks and other financial institutions,
which are deemed by the investment advisor to be creditworthy pursuant to
guidelines established by the Board of Trustees.
Pursuant to an exemptive order issued by the Securities and Exchange Commis-
sion, Global Opportunities Fund, International Growth Fund, Latin America Fund
and Precious Metals Fund along with certain other funds managed by Evergreen
Investment Management Company ("EIMC"), a subsidiary of First Union, may trans-
fer uninvested cash balances into a joint trading account. These balances are
invested in one or more repurchase agreements that are fully collateralized by
U.S. Treasury and/or federal agency obligations.
C. Foreign Currency
The books and records of the Funds are maintained in United States (U.S.) dol-
lars. Foreign currency amounts are translated into U.S. dollars as follows:
market value of investment securities, other assets and liabilities at the
daily rate of exchange; purchases and sales of investment securities and income
and expenses at the rate of exchange prevailing on the respective dates of such
transactions. Net unrealized foreign exchange gains or losses resulting from
changes in foreign currency exchange rates are a component of net unrealized
gains or losses on securities and foreign currency related transactions. Net
realized foreign currency gains or losses on foreign currency related transac-
tions include foreign currency gains and losses between trade date and settle-
ment date on investment securities transactions, foreign currency related
transactions and the difference between the amounts of interest and dividends
recorded on the books of the Funds and the amounts actually received. The por-
tion of foreign currency gains or losses related to fluctuations in exchange
rates between the initial purchase trade date and subsequent sale trade date is
included in realized gains or losses on securities.
D. Futures Contracts
In order to gain exposure to or protect against changes in security values, the
Funds may buy and sell futures contracts.
The initial margin deposited with a broker when entering into a futures trans-
action is subsequently adjusted by daily payments or receipts ("variation mar-
gin") as the value of the contract changes. Such changes are recorded as
unrealized gains or losses. Realized gains or losses are recognized on closing
the contract.
Risks of entering into futures contracts include (i) the possibility of an il-
liquid market for the contract, (ii) the possibility that a change in the value
of the contract may not correlate with changes in the value of the underlying
instrument or index, and (iii) the credit risk that the other party will not
fulfill their obligations under the contract. Futures contracts also involve
elements of market risk in excess of the amount reflected in the Statements of
Assets and Liabilities.
E. Forward Foreign Currency Exchange Contracts
The Funds may enter into forward foreign currency exchange contracts ("forward
contracts") to settle portfolio purchases and sales of securities denominated
in a foreign currency and to hedge certain foreign currency
73
<PAGE>
Combined Notes to Financial Statements (continued)
assets or liabilities. Forward contracts are recorded at the forward rate and
marked-to-market daily. Realized gains and losses arising from such transac-
tions are included in net realized gains or losses on foreign currency related
transactions. The Funds bear the risk of an unfavorable change in the foreign
currency exchange rate underlying the forward contract and are subject to the
credit risk that the other party will not fulfill their obligations under the
contract. Forward contracts involve elements of market risk in excess of the
amount reflected in the Statements of Assets and Liabilities.
F. Securities Lending
In order to generate income and to offset expenses, the Funds may lend portfo-
lio securities to brokers, dealers and other financial organizations. The
Funds' investment advisors will monitor the creditworthiness of such borrowers.
Loans of securities may not exceed 33 1/3% of a Fund's total assets and will be
collateralized by cash, letters of credit or U.S. Government securities that
are maintained at all times in an amount equal to at least 100% of the current
market value of the loaned securities, including accrued interest. The Fund
monitors the adequacy of the collateral daily and will require the borrower to
provide additional collateral in the event the value of the collateral falls
below 100% of the market value of the securities on loan. While such securities
are on loan, the borrower will pay a Fund any income accruing thereon, and the
Fund may invest any cash collateral received in portfolio securities, thereby
increasing its return. A Fund will have the right to call any such loan and ob-
tain the securities loaned at any time on five days' notice. Any gain or loss
in the market price of the loaned securities, which occurs during the term of
the loan, would affect a Fund and its investors. A Fund may pay fees in connec-
tion with such loans.
G. Security Transactions and Investment Income
Securities transactions are accounted for no later than one business day after
the trade date. Realized gains and losses are computed on the identified cost
basis. Interest income is recorded on the accrual basis and includes accretion
of discounts and amortization of premiums. Dividend income is recorded on the
ex-dividend date or in the case of some foreign securities, on the date
thereafter when the Fund is made aware of the dividend. Foreign income and
capital gains realized on some foreign securities may be subject to foreign
taxes, which are accrued as applicable.
H. Federal Taxes
The Funds have qualified and intend to continue to qualify as regulated invest-
ment companies under the Internal Revenue Code of 1986, as amended (the
"Code"). Thus, the Funds will not incur any federal income tax liability since
they are expected to distribute all of their net investment company taxable in-
come and net capital gains, if any, to their shareholders. The Funds also in-
tend to avoid any excise tax liability by making the required distributions un-
der the Code. Accordingly, no provision for federal taxes is required. To the
extent that realized capital gains can be offset by capital loss carryforwards,
it is each Fund's policy not to distribute such gains.
I. Distributions
Distributions from net investment income and/or net realized capital gains for
the Funds, if any, are declared and paid at least annually. Distributions to
shareholders are recorded at the close of business on the ex-dividend date.
Income and capital gains distributions to shareholders are determined in accor-
dance with income tax regulations, which may differ from generally accepted ac-
counting principles. The significant differences between financial statement
amounts available for distributions and distributions made in accordance with
income tax regulations are primarily due to differing treatment for net operat-
ing losses, net realized foreign currency gains or losses, unrealized deprecia-
tion on passive foreign investment companies, certain repurchases of securities
sold at a loss and certain capital loss carryforwards assumed as a result of
acquisitions.
J. Class Allocations
Income, expenses (other than class specific expenses) and realized and
unrealized gains and losses are prorated among the classes based on the rela-
tive net assets of each class. Currently, class specific expenses are limited
to expenses incurred under the Distribution Plans for each class.
74
<PAGE>
Combined Notes to Financial Statements (continued)
K. Organization Expenses
Organization expenses incurred prior to July 1998 are amortized to operations
over a five-year period on a straight-line basis. In the event any of the ini-
tial shares of the Funds are redeemed by any holder during the five-year amor-
tization period, redemption proceeds will be reduced by any unamortized organi-
zation expenses in the same proportion as the number of initial shares being
redeemed bears to the number of initial shares outstanding at the time of the
redemption. As of October 31, 1999, organization costs for the Emerging Markets
Growth Fund, Global Opportunities Fund, International Growth Fund, Latin Amer-
ica Fund and Precious Metals Fund have been fully amortized.
3. INVESTMENT IN FOREIGN SUBSIDIARY
Precious Metals (Bermuda) Ltd., a wholly-owned, unconsolidated foreign subsidi-
ary of the Precious Metals Fund, was acquired in May 1975 and has as its pri-
mary objective the acquisition of precious metals. The Fund accounts for its
investments in the subsidiary under the equity method of accounting. At October
31, 1999, the fair value of the Fund's investment in the foreign subsidiary was
determined as follows:
<TABLE>
<S> <C>
Cash and cash equivalents............................... $892,675
Accrued expenses........................................ (28,723)
--------
$863,952
========
</TABLE>
During the year ended October 31, 1999, the foreign subsidiary had no purchases
of precious metals or sales of precious metals. Investment activities of the
foreign subsidiary resulted in gross investment income, general and administra-
tive expenses, net investment income of $37,920, $18,492 and $19,428, respec-
tively. Management fees paid or accrued to EIMC totaled $5,871 during the year
ended October 31, 1999.
4. INVESTMENT ADVISORY AGREEMENTS AND OTHER AFFILIATED TRANSACTIONS
Evergreen Investment Management ("EIM"), a division of First Union National
Bank ("FUNB"), is the investment advisor to Emerging Markets Growth Fund and is
paid an advisory fee that is computed daily and paid monthly based on its aver-
age daily net assets, in accordance with the following schedule:
<TABLE>
<CAPTION>
Average Daily Net Assets
-----------------------------------------
<S> <C>
on the first $100 million.......... 1.50%
on the next $100 million........... 1.45
on the next $100 million........... 1.40
in excess of $300 million.......... 1.35
</TABLE>
EIMC is the investment sub-advisor to Emerging Markets Growth Fund. Under the
terms of the sub-advisory agreement, EIMC is responsible for the investment de-
cisions for the Fund and is paid by EIM at no additional expense to the Fund.
Evergreen Asset Management Corp. ("EAMC"), a wholly-owned subsidiary of First
Union, is the investment advisor to Global Leaders Fund and is paid an advisory
fee that is computed daily and paid monthly at an annual rate of 0.95% of its
average daily net assets.
Lieber & Company, an affiliate of First Union, is the investment sub-advisor to
Global Leaders Fund and also provides brokerage services with respect to sub-
stantially all security transactions of the Fund effected on the New York or
American Stock Exchanges. During the year ended October 31, 1999, Global Lead-
ers Fund incurred brokerage commissions of $190,546 with Lieber & Company.
Lieber & Company is reimbursed by EAMC for providing investment sub-advisory
services at no additional expense to Global Leaders Fund.
75
<PAGE>
Combined Notes to Financial Statements (continued)
EIMC is the investment advisor for Global Opportunities Fund, International
Growth Fund, Latin America Fund and Precious Metals Fund. In return for provid-
ing investment management and administrative services to the Funds, EIMC is
paid an advisory fee that is computed daily and paid monthly based on each
Fund's average daily net assets, in accordance with the following schedules:
<TABLE>
<CAPTION>
Global International Latin
Opportunities Growth America
Average Daily Net Assets Fund Fund Fund
----------------------------------------------------------------
<S> <C> <C> <C>
on the first $200 million.. 1.00% 0.75% 0.75%
on the next $200 million .. 0.95 0.65 0.65
on the next $200 million .. 0.85 0.55 0.55
in excess of $600 million.. 0.75 0.45 0.45
<CAPTION>
Precious
Metals
Average Daily Net Assets Fund
---------------------------------------
<S> <C>
on the first $100 million.. 0.750%
on the next $100 million... 0.625
in excess of $200 million.. 0.500
</TABLE>
For Precious Metals Fund, Harbor Capital Management Company, Inc. ("Harbor Cap-
ital"), is a consultant to EIMC and its subsidiary pursuant to a Consultant
Agreement. In accordance with the terms of the Consultant Agreement, Harbor
Capital provides EIMC with monthly reports discussing the world's gold bullion
markets, the gold stock markets, and advice regarding economic factors and
trends in the precious metals sectors. For its services, Harbor Capital re-
ceives from EIMC a fee at the annual rate of 3.50% of the Fund's average daily
net assets. Expenses associated with these services are a cost of EIMC and are
not a Fund expense.
Mentor Perpetual Advisors, LLC ("Mentor Perpetual") is the investment advisor
to the Perpetual International Fund. Mentor Perpetual, a wholly-owned, indirect
subsidiary of First Union, is owned equally by Mentor Investment Advisors, LLC,
and Perpetual PLC, a diversified financial services holding company. Mentor
Perpetual is paid a fee that is computed daily and paid monthly at an annual
rate of 1.00% of the Fund's average daily net assets.
Evergreen Investment Services ("EIS"), a subsidiary of First Union, is the ad-
ministrator to the Funds. As administrator, EIS provides the Funds with facili-
ties, equipment and personnel. The BISYS Group, Inc. ("BISYS"), is the
sub-ad-ministrator to the Funds. As sub-administrator, BISYS provides the
officers of each Fund, except Perpetual International Fund. Officers of the
Funds and af-filiated Trustees receive no compensation directly from the Funds.
The administrator and sub-administrator for Emerging Markets Growth Fund and
Global Leaders Fund are entitled to an annual fee based on the average daily
net assets of the funds administered by EIS for which First Union or its in-
vestment advisory subsidiaries are also the investment advisors. The adminis-
tration fee is calculated by applying percentage rates, which start at 0.05%
and decline to 0.01% per annum as net assets increase, to the average daily net
assets of the Fund. The sub-administration fee is calculated by applying per-
centage rates, which start at 0.01% and decline to 0.004% per annum as net as-
sets increase, to the average daily net assets of the Fund.
For the year ended October 31, 1999, Emerging Markets Growth Fund and Global
Leaders Fund paid or accrued to EIS the following amounts for administrative
and sub-administrative services:
<TABLE>
<CAPTION>
Administration Sub-administration
Fee Fee
-------------------------------
<S> <C> <C>
Emerging Markets Fund......... $11,811 $ 3,101
Global Leaders Fund........... 74,678 19,591
</TABLE>
For the year ended October 31, 1999, Global Opportunities Fund, International
Growth Fund, Latin America Fund and Precious Metals Fund reimbursed EIMC
$26,349, $106,380, $4,434, and $13,832, respectively, for providing certain ad-
ministration and accounting expenses.
76
<PAGE>
Combined Notes to Financial Statements (continued)
For Perpetual International Fund, EIS is entitled to an annual fee based on
0.10% of the average daily net assets of the Fund. Prior to June 14, 1999, Men-
tor Investment Group, LLC ("Mentor") provided administrative personnel and
services to the Perpetual International Fund at the same rate indicated above.
Prior to April 1, 1999, the fee paid to Mentor for administrative services for
the Perpetual International Fund was 0.10% of the Fund's average daily net as-
sets.
For the year ended October 31, 1999, the Perpetual International Fund paid or
accrued $43,151 and $98,675 to EIS and Mentor for administrative services.
Evergreen Service Company ("ESC"), an indirect, wholly-owned subsidiary of
First Union, is the transfer and dividend disbursing agent for the Funds.
5. DISTRIBUTION PLANS
Evergreen Distributor, Inc. ("EDI"), a wholly-owned subsidiary of BISYS, is the
principal underwriter to the Funds.
Each Fund has adopted Distribution Plans, as allowed by Rule 12b-1 of the 1940
Act, for each class of shares, except Class Y. Distribution plans permit a Fund
to compensate its principal underwriter for costs related to selling shares of
the Fund and for various other services. These costs, which consist primarily
of commissions and service fees to broker-dealers who sell shares of the Fund,
are paid by the Fund through "Distribution Plan expenses". Under the Distribu-
tion Plans, Class A incurs distribution fees equal to 0.25% of the average
daily net asset of the class, all of which is used to pay for shareholder serv-
ice fees. Class B and Class C incur distribution fees equal to 1.00% of the av-
erage daily net assets of each class. Of this amount, 0.25% of the distribution
fees incurred is used to pay for shareholder service fees and 0.75% is used to
pay for distribution-related costs. Distribution Plan expenses are calculated
daily and paid at least quarterly.
During the year ended October 31, 1999, amounts paid or accrued to EDI pursuant
to each Fund's Class A, Class B and Class C Distribution Plans were as follows:
<TABLE>
<CAPTION>
Class A Class B Class C
<S> <C> <C> <C>
----------------------------
Emerging Markets Growth Fund...... $ 20,008 $ 31,741 $ 9,204
Global Leaders Fund............... 357,791 1,912,201 44,877
Global Opportunities Fund......... 138,171 1,119,637 204,776
International Growth Fund......... 319,531 680,946 29,317
Latin America Fund................ 15,337 243,508 38,612
Perpetual International Fund*..... 8,736 29 75,625
Precious Metals Fund.............. 181,562 174,458 5,640
</TABLE>
-------
* For the period from October 18, 1999 to October 31, 1999.
With respect to Class B and Class C shares, the principal underwriter may pay
distribution fees greater than the allowable annual amounts each Fund is per-
mitted to pay under the Distribution Plans.
Each of the Distribution Plans may be terminated at any time by vote of the In-
dependent Trustees or by vote of a majority of the outstanding voting shares of
the respective class.
Prior to October 18, 1999, Mentor Distributors, LLC ("Mentor Distributors")
served as principal underwriter to the Mentor Perpetual International Portfo-
lio. Mentor Distributors is a wholly-owned subsidiary of BISYS Fund Services,
Inc. The Mentor Perpetual International Portfolio had adopted a Distribution
Plan under Rule 12b-1 of the 1940 Act for its Class B shares. To compensate
Mentor Distributors for the services it provided and for the expenses it in-
curred, Class B shares of Mentor Perpetual International Portfolio paid a dis-
tribution fee of 0.75%, which was accrued daily and paid monthly.
77
<PAGE>
Combined Notes to Financial Statements (continued)
Prior to October 18, 1999, the Mentor Perpetual International Portfolio had
also adopted a Shareholder Servicing Plan (the "Service Plan") with Mentor Dis-
tributors with respect to its Class A, Class B and Class E shares. Under the
Service Plan, financial institutions entered into shareholder service agree-
ments with the Mentor Perpetual International Portfolio to provide administra-
tive support services to their customers who from time to time might have been
owners of record or beneficial owners of Class A, Class B or Class E shares of
one or more Mentor Funds. In return for providing these support services, a fi-
nancial institution might have received payments from one or more Mentor Funds
at an annual rate of 0.25% of the average daily net assets of the Class A,
Class B or Class E shares of the Mentor Perpetual International Portfolio bene-
ficially owned by the financial institution's customers for whom it was a
holder of record or with whom it had a servicing relationship.
During the year ended October 31, 1999, amounts paid or accrued to Mentor Dis-
tributors pursuant to the Mentor Perpetual International Portfolio's Class A,
Class C (former Class B), and Class E Distribution and Service Plans were
$194,503, $436,536 and $5,995, respectively.
6. ACQUISITION INFORMATION
Effective on the close of business on February 27, 1998, Global Leaders Fund
acquired substantially all the assets and assumed certain liabilities of
Blanchard Global Growth Fund, an open-end management investment company regis-
tered under the 1940 Act, in an exchange of Class A shares of Global Leaders
Fund.
Effective on the close of business on February 27, 1998, Precious Metals Fund
acquired substantially all the assets and assumed certain liabilities of
Blanchard Precious Metals Fund, an open-end management investment company reg-
istered under the 1940 Act, in an exchange of Class A shares of Precious Metals
Fund.
Effective on the close of business on July 27, 1998, International Growth Fund
acquired substantially all the assets and assumed certain liabilities of
CoreFund Inc. International Growth Fund, an open-end management investment com-
pany registered under the 1940 Act, in an exchange of Class A, Class B and
Class Y shares of International Growth Fund.
Effective on the close of business on October 28, 1998, International Growth
Fund acquired substantially all the assets and assumed certain liabilities of
Evergreen International Equity Fund, an open-end management investment company
registered under the 1940 Act, in an exchange of Class A, Class B, Class C and
Class Y shares of International Growth Fund.
The acquisitions were accomplished by a tax-free exchange of the respective
shares of each Fund. The value of net assets acquired, number of shares issued,
unrealized appreciation or depreciation acquired, and the aggregrate net assets
of each Fund immediately after the acquisition were as follows:
<TABLE>
<CAPTION>
Unrealized
Value of Net Number of Appreciation Net Assets
Acquiring Fund Acquired Fund Assets Acquired Shares Issued (Depreciation) After Acquisition
- ---------------------------------------------------------------------------------------------------------------------
<C> <S> <C> <C> <C> <C>
Global Leaders Fund Blanchard Global Growth
Fund $ 55,765,847 3,648,723 $ 2,310,198 $300,362,320
Precious Metals Fund Blanchard Precious Metals
Fund 39,424,759 2,927,140 (38,301,971) 144,108,204
International Growth Fund CoreFund Inc.
International Growth Fund 182,359,660 21,043,735 38,264,074 423,700,663
International Growth Fund Evergreen International
Equity Fund 222,394,077 30,307,946 11,505,330 619,339,196
</TABLE>
78
<PAGE>
Combined Notes to Financial Statements (continued)
7. CAPITAL SHARE TRANSACTIONS
The Funds have an unlimited number of shares of beneficial interest with $0.001
par value authorized. Shares of beneficial interest of the Funds are currently
divided into Class A, Class B, Class C and/or Class Y. Transactions in shares
of the Funds were as follows:
Emerging Markets Growth Fund
<TABLE>
<CAPTION>
Year Ended October 31,
--------------------------------------------------
1999 1998
------------------------ ------------------------
Shares Amount Shares Amount
- -------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A
Shares sold............... 3,543,290 $ 29,482,483 1,539,603 $ 14,993,843
Automatic conversion of
Class B shares to Class A
shares................... 10 77 0 0
Shares redeemed........... (3,428,541) (28,781,121) (1,041,101) (10,071,395)
Shares issued on
reinvestment of
distributions............ 1,318 10,188 8,077 78,672
- -------------------------------------------------------------------------------
Net increase.............. 116,077 711,627 506,579 5,001,120
- -------------------------------------------------------------------------------
Class B
Shares sold............... 407,049 3,522,757 150,671 1,447,684
Automatic conversion of
Class B shares to Class A
shares................... (11) (77) 0 0
Shares redeemed........... (410,595) (3,530,980) (182,867) (1,703,438)
Shares issued on
reinvestment of
distributions............ 525 3,951 10,499 100,681
- -------------------------------------------------------------------------------
Net decrease.............. (3,032) (4,349) (21,697) (155,073)
- -------------------------------------------------------------------------------
Class C
Shares sold............... 683,522 5,671,715 65,455 599,325
Shares redeemed........... (645,248) (5,421,662) (124,024) (1,217,706)
Shares issued on
reinvestment of
distributions............ 128 965 3,451 33,092
- -------------------------------------------------------------------------------
Net increase (decrease)... 38,402 251,018 (55,118) (585,289)
- -------------------------------------------------------------------------------
Class Y
Shares sold............... 606,350 5,374,900 1,333,842 12,710,847
Shares redeemed........... (1,201,144) (9,809,452) (1,382,744) (12,835,771)
Shares issued on
reinvestment of
distributions............ 12,822 99,883 108,476 1,060,894
- -------------------------------------------------------------------------------
Net increase (decrease)... (581,972) (4,334,669) 59,574 935,970
- -------------------------------------------------------------------------------
Net increase (decrease)... $ (3,376,373) $ 5,196,728
- -------------------------------------------------------------------------------
</TABLE>
Global Leaders Fund
<TABLE>
<CAPTION>
Year Ended October 31,
---------------------------------------------------------
1999 1998
----------------------------- --------------------------
Shares Amount Shares Amount
- ------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A
Shares sold............. 149,775,697 $ 2,553,984,674 30,930,256 $ 447,933,681
Automatic conversion of
Class B shares to Class
A shares............... 29,476 486,432
Shares redeemed......... (149,220,868) (2,545,616,938) (27,875,118) (405,306,465)
Shares issued on
reinvestment of
distributions.......... 0 0 11,768 163,222
Shares issued in
acquisition of
Blanchard Global Growth
Fund................... 0 0 3,648,723 55,765,847
- ------------------------------------------------------------------------------------
Net increase............ 584,305 8,854,168 6,715,629 98,556,285
- ------------------------------------------------------------------------------------
Class B
Shares sold............. 2,983,412 49,075,131 3,186,919 47,469,163
Automatic conversion of
Class B shares to Class
A shares............... (30,042) (486,432)
Shares redeemed......... (2,712,290) (44,818,465) (1,832,008) (26,758,571)
Shares issued on
reinvestment of
distributions.......... 0 0 41,954 575,190
- ------------------------------------------------------------------------------------
Net increase............ 241,080 3,770,234 1,396,865 21,285,782
- ------------------------------------------------------------------------------------
Class C
Shares sold............. 436,197 7,288,074 181,393 2,719,744
Shares redeemed......... (449,559) (7,565,353) (94,685) (1,374,676)
Shares issued on
reinvestment of
distributions.......... 0 0 721 9,873
- ------------------------------------------------------------------------------------
Net increase
(decrease)............. (13,362) (277,279) 87,429 1,354,941
- ------------------------------------------------------------------------------------
Class Y
Shares sold............. 1,229,283 20,568,567 1,226,789 18,343,144
Shares redeemed......... (1,473,987) (24,731,995) (1,034,996) (15,251,611)
Shares issued on
reinvestment of
distributions.......... 0 0 4,034 56,109
- ------------------------------------------------------------------------------------
Net increase
(decrease)............. (244,704) (4,163,428) 195,827 3,147,642
- ------------------------------------------------------------------------------------
Net increase............ $ 8,183,695 $ 124,344,650
</TABLE>
- --------------------------------------------------------------------------------
79
<PAGE>
Combined Notes to Financial Statements (continued)
Global Opportunities Fund
<TABLE>
<CAPTION>
Year Ended October 31,
----------------------------------------------------
1999 1998
------------------------- -------------------------
Shares Amount Shares Amount
- -------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A
Shares sold............. 4,627,373 $ 99,881,014 4,344,269 $ 98,654,176
Automatic conversion of
Class B shares to Class
A shares............... 14,891 303,460 0 0
Shares redeemed......... (5,772,965) (124,989,786) (5,674,012) (128,741,779)
Shares issued on
reinvestment of
distributions.......... 122,671 2,341,786 224,106 4,890,006
- -------------------------------------------------------------------------------
Net decrease............ (1,008,030) (22,463,526) (1,105,637) (25,197,597)
- -------------------------------------------------------------------------------
Class B
Shares sold............. 1,129,856 22,630,544 310,625 6,886,751
Automatic conversion of
Class B shares to Class
A shares............... (15,664) (303,460) 0 0
Shares redeemed......... (3,636,366) (72,583,990) (3,830,040) (82,094,577)
Shares issued on
reinvestment of
distributions.......... 395,618 7,188,374 620,042 13,008,494
- -------------------------------------------------------------------------------
Net decrease............ (2,126,556) (43,068,532) (2,899,373) (62,199,332)
- -------------------------------------------------------------------------------
Class C
Shares sold............. 301,760 6,526,297 102,028 2,319,959
Shares redeemed......... (818,441) (16,857,938) (908,274) (19,515,716)
Shares issued on
reinvestment of
distributions.......... 74,800 1,362,112 126,413 2,657,194
- -------------------------------------------------------------------------------
Net decrease............ (441,881) (8,969,529) (679,833) (14,538,563)
- -------------------------------------------------------------------------------
Class Y
Shares sold............. 345,945 7,006,438 301,547 6,065,232
Shares redeemed......... (338,842) (6,872,243) (299,939) (6,075,384)
Shares issued on
reinvestment of
distributions.......... 102 1,957 0 0
- -------------------------------------------------------------------------------
Net increase
(decrease)............. 7,205 136,152 1,608 (10,152)
- -------------------------------------------------------------------------------
Net decrease............ $ (74,365,435) $(101,945,644)
</TABLE>
- --------------------------------------------------------------------------------
International Growth Fund
<TABLE>
<CAPTION>
Year Ended October 31,
-----------------------------------------------------
1999 1998 (a)
-------------------------- -------------------------
Shares Amount Shares Amount
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A
Shares sold............. 21,575,997 $ 171,780,072 12,077,791 $ 92,358,078
Automatic conversion of
Class B shares to Class
A shares............... 1,347,930 10,713,110 13,877,478 95,438,329
Shares redeemed......... (25,523,574) (203,568,111) (11,196,609) (85,043,609)
Shares issued in
acquisition of
Evergreen International
Equity Fund............ 0 0 2,164,961 15,927,622
Shares issued in
acquisition of CoreFund
Inc. International
Growth Fund............ 0 0 303,491 2,627,478
- --------------------------------------------------------------------------------
Net increase
(decrease)............. (2,599,647) (21,074,929) 17,227,112 121,307,898
- --------------------------------------------------------------------------------
Class B
Shares sold............. 1,787,282 13,964,924 6,504,930 50,772,491
Automatic conversion of
Class B shares to Class
A shares............... (1,357,201) (10,713,110) (13,877,478) (95,438,329)
Shares redeemed......... (3,169,583) (25,101,734) (6,669,302) (50,597,968)
Shares issued on
reinvestment of
distributions.......... 0 0 4,141,410 28,410,070
Shares issued in
acquisition of
Evergreen International
Equity Fund............ 0 0 2,500,823 18,307,019
Shares issued in
acquisition of CoreFund
Inc. International
Growth Fund............ 0 0 7,427 64,064
- --------------------------------------------------------------------------------
Net decrease............ (2,739,502) (21,849,920) (7,392,190) (48,482,653)
- --------------------------------------------------------------------------------
Class C
Shares sold............. 1,396,578 10,829,107 946,471 7,475,561
Shares redeemed......... (1,578,331) (12,298,336) (594,348) (4,518,373)
Shares issued in
acquisition of
Evergreen International
Equity Fund............ 0 0 102,170 747,667
- --------------------------------------------------------------------------------
Net increase
(decrease)............. (181,753) (1,469,229) 454,293 3,704,855
- --------------------------------------------------------------------------------
Class Y
Shares sold............. 13,098,531 104,579,420 14,864,337 121,402,695
Shares redeemed......... (12,649,097) (100,994,728) (3,664,709) (27,667,505)
Shares issued in
acquisition of
Evergreen International
Equity Fund............ 0 0 25,539,992 187,411,771
Shares issued in
acquisition of CoreFund
Inc. International
Growth Fund............ 0 0 20,732,817 179,668,118
- --------------------------------------------------------------------------------
Net increase............ 449,434 3,584,692 57,472,437 460,815,079
- --------------------------------------------------------------------------------
Net increase
(decrease)............. $ (40,809,386) $537,345,179
</TABLE>
- --------------------------------------------------------------------------------
(a) For Class A, Class C and Class Y, for the period from January 20, 1998,
March 6, 1998 and March 9, 1998, respectively (commencement of class opera-
tions) to October 31, 1998.
80
<PAGE>
Combined Notes to Financial Statements (continued)
Latin America Fund
<TABLE>
<CAPTION>
Year Ended October 31,
--------------------------------------------------
1999 1998
------------------------ ------------------------
Shares Amount Shares Amount
- -------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A
Shares sold............... 1,930,232 $ 14,545,208 1,613,531 $ 15,352,461
Automatic conversion of
Class B shares to Class A
shares................... 34,610 210,139
Shares redeemed........... (2,242,871) (17,283,474) (2,045,506) (19,559,738)
Shares issued on
reinvestment of
distributions............ 0 0 253,396 2,718,936
- -------------------------------------------------------------------------------
Net decrease.............. (278,029) (2,528,127) (178,579) (1,488,341)
- -------------------------------------------------------------------------------
Class B
Shares sold............... 1,066,302 7,728,794 1,117,118 10,223,995
Automatic conversion of
Class B shares to Class A
shares................... (35,725) (210,139) 0 0
Shares redeemed........... (2,826,857) (20,333,293) (3,992,062) (38,151,546)
Shares issued on
reinvestment of
distributions............ 0 0 1,410,947 14,772,617
- -------------------------------------------------------------------------------
Net decrease.............. (1,796,280) (12,814,638) (1,463,997) (13,154,934)
- -------------------------------------------------------------------------------
Class C
Shares sold............... 427,770 3,341,817 129,986 1,190,136
Shares redeemed........... (611,544) (4,630,544) (537,453) (5,288,412)
Shares issued on
reinvestment of
distributions............ 0 0 203,815 2,133,947
- -------------------------------------------------------------------------------
Net decrease.............. (183,774) (1,288,727) (203,652) (1,964,329)
- -------------------------------------------------------------------------------
Class Y
Shares sold............... 58,016 485,219 3,714 39,405
Shares redeemed........... (29,686) (260,089) 0 0
- -------------------------------------------------------------------------------
Net increase.............. 28,330 225,130 3,714 39,405
- -------------------------------------------------------------------------------
Net decrease.............. $(16,406,362) $(16,568,199)
</TABLE>
- --------------------------------------------------------------------------------
Perpetual International Fund (a)
<TABLE>
<CAPTION>
Year Ended October 31,
--------------------------------------------------
1999 1998
------------------------- -----------------------
Shares Amount Shares Amount
- ------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A (b) (c)
Shares sold............... 8,955,978 $ 146,972,039 2,862,698 $ 42,025,665
Shares redeemed........... (8,308,120) (138,054,461) (882,718) (12,590,371)
Shares issued on
reinvestment of
distributions............ 0 0 52,857 752,203
- ------------------------------------------------------------------------------
Net increase.............. 647,858 8,917,578 2,032,837 30,187,497
- ------------------------------------------------------------------------------
Class B (d)
Shares sold............... 13,367 243,053 0 0
- ------------------------------------------------------------------------------
Net increase.............. 13,367 243,053 0 0
- ------------------------------------------------------------------------------
Class C (b)
Shares sold............... 1,150,156 18,818,762 1,859,926 27,973,060
Shares redeemed........... (723,566) (11,761,221) (380,236) (5,482,882)
Shares issued on
reinvestment of
distributions............ 0 0 33,872 478,262
- ------------------------------------------------------------------------------
Net increase.............. 426,590 7,057,541 1,513,562 22,968,440
- ------------------------------------------------------------------------------
Class Y (b)
Shares sold............... 44 750 95 1,350
Shares redeemed........... (390,913) (6,130,434) (426,754) (5,756,280)
Shares issued on
reinvestment of
distributions............ 0 0 11,659 165,455
- ------------------------------------------------------------------------------
Net decrease.............. (390,869) (6,129,684) (415,000) (5,589,475)
- ------------------------------------------------------------------------------
Net increase.............. $ 10,088,488 $ 47,566,462
</TABLE>
- --------------------------------------------------------------------------------
(a) Formerly Mentor Perpetual International Portfolio.
(b) Effective October 18, 1999, shareholders of Mentor Perpetual International
Portfolio Class A, Class B and Class Y shares became owners of that number
of full and fractional shares of Class A, Class C and Class Y shares, re-
spectively, of Evergreen Perpetual International Fund. In addition, Class B
shares of Mentor Perpetual International Portfolio were redesignated as
Class C shares of Evergreen Perpetual International Fund.
(c) As a result of the conversion of Mentor Perpetual International Portfolio
to Evergreen Perpetual International Fund, the shareholders of Mentor Per-
petual International Portfolio, Class E, became owners of that number of
full and fractional shares of Evergreen Perpetual International Fund, Class
A, having a net asset value equal to the net asset value of their shares
immediately prior to the conversion of shares.
(d) For the period from October 18, 1999 (commencement of class operations) to
October 31, 1999.
81
<PAGE>
Combined Notes to Financial Statements (continued)
Precious Metals Fund
<TABLE>
<CAPTION>
Year Ended October 31,
---------------------------------------------------
1999 1998 (a)
------------------------ -------------------------
Shares Amount Shares Amount
- -------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A
Shares sold.............. 4,753,120 $ 53,717,724 8,349,123 $ 105,589,468
Automatic conversion of
Class B shares to Class
A shares................ 451,153 5,261,155 5,262,793 65,498,249
Shares redeemed.......... (6,526,818) (73,614,764) (9,374,304) (120,653,639)
Shares issued in
acquisition of Blanchard
Precious Metals Fund.... 0 0 2,927,140 39,424,759
- -------------------------------------------------------------------------------
Net increase (decrease).. (1,322,545) (14,635,885) 7,164,752 89,858,837
- -------------------------------------------------------------------------------
Class B
Shares sold.............. 1,911,827 21,129,266 5,743,525 72,210,449
Automatic conversion of
Class B shares to Class
A shares................ (454,370) (5,261,155) (5,262,793) (65,498,249)
Shares redeemed.......... (2,506,551) (28,224,561) (5,616,171) (71,713,756)
Shares issued on
reinvestment of
distributions........... 0 0 357,072 4,759,767
- -------------------------------------------------------------------------------
Net decrease............. (1,049,094) (12,356,450) (4,778,367) (60,241,789)
- -------------------------------------------------------------------------------
Class C
Shares sold.............. 1,133,571 12,718,285 146,046 1,761,107
Shares redeemed.......... (1,142,043) (12,835,852) (97,906) (1,087,497)
- -------------------------------------------------------------------------------
Net increase (decrease).. (8,472) (117,567) 48,140 673,610
- -------------------------------------------------------------------------------
Net increase (decrease).. $(27,109,902) $ 30,290,658
</TABLE>
- --------------------------------------------------------------------------------
(a) For Class A and Class C, for the period from January 20, 1998 and January
29, 1998, respectively (commencement of class operations) to October 31,
1998.
8. SECURITIES TRANSACTIONS
Cost of purchases and proceeds from sales of investment securities (excluding
short-term securities) were as follows for the year ended October 31, 1999:
<TABLE>
<CAPTION>
Cost of Purchases Proceeds from Sales
-------------------------------------
<S> <C> <C>
Emerging Markets Growth
Fund.................... $136,026,761 $119,513,892
Global Leaders Fund
U.S. Government.......... 0 5,191,040
Non-U.S. Government...... 123,783,927 129,460,458
Global Opportunities
Fund.................... 250,042,202 334,639,122
International Growth
Fund.................... 844,108,508 819,095,249
Latin America Fund....... 81,757,399 80,624,623
Perpetual International
Fund.................... 177,179,318 163,783,876
Precious Metals Fund..... 26,249,067 56,138,655
</TABLE>
For the year ended October 31, 1999, Global Opportunities Fund and Perpetual
International Fund loaned securities to certain brokers who paid the Funds a
negotiated lenders' fee. These fees are included in interest income. At October
31, 1999, the value of securities on loan and the value of collateral were as
follows:
<TABLE>
<CAPTION>
Value of Securities Value of
on Loan Collateral
------------------------------
<S> <C> <C>
Global Opportunities Fund....... $15,340,425 $15,173,743
Perpetual International Fund.... 16,492,576 17,284,173
</TABLE>
On October 31, 1999, the composition of unrealized appreciation and deprecia-
tion of securities based on the aggregate cost of securities for federal income
tax purposes was as follows:
<TABLE>
<CAPTION>
Gross Gross Net Unrealized
Tax Unrealized Unrealized Appreciation
Cost Appreciation Depreciation (Depreciation)
-------------------------------------------------
<S> <C> <C> <C> <C>
Emerging
Markets Growth
Fund.......... $ 57,727,309 $ 10,877,855 $ 4,539,487 $ 6,338,368
Global Leaders
Fund.......... 322,868,633 137,183,654 16,762,574 120,421,080
Global
Opportunities
Fund.......... 149,333,805 56,572,323 4,650,938 51,921,385
International
Growth Fund... 607,111,268 112,427,947 21,604,772 90,823,175
Latin America
Fund.......... 25,855,401 5,104,856 1,327,484 3,777,372
Perpetual
International
Fund.......... 162,027,750 26,886,436 9,400,252 17,486,184
Precious Metals
Fund.......... 95,448,025 19,760,162 33,822,066 (14,061,904)
</TABLE>
During the year ended October 31, 1999, Global Opportunities Fund and Perpetual
International Fund earned $53,029 and $114,216, respectively, in income from
securities lending.
82
<PAGE>
Combined Notes to Financial Statements (continued)
For federal tax purposes, the following funds had capital loss carryforwards as
of October 31, 1999:
<TABLE>
<CAPTION>
Capital Loss Carryforward Expiration
------------------------------------
<S> <C> <C>
Emerging Markets Fund...... $10,853,315 2006
Global Leaders Fund........ 998,597 2005
International Growth Fund.. 22,838,189 2005
Latin America Fund......... 18,780,605 2006
5,971,777 2007
Precious Metals Fund....... 4,502,429 2005
50,308,129 2006
33,416,250 2007
</TABLE>
The capital loss carryforwards of Global Leaders Fund and International Growth
Fund were the result of the acquisitions described in Note 6. As such, these
capital loss carryforwards may not be used to offset certain gains of their re-
spective Funds, in accordance with federal tax regulations.
9. EXPENSE OFFSET ARRANGEMENTS
All Funds have entered into an expense offset arrangement with ESC and their
custodian whereby credits realized as a result of uninvested cash balances were
used to reduce a portion of each Fund's related expenses. For Perpetual Inter-
national Fund, the expense offset arrangements with ESC and their custodian be-
came effective on September 13, 1999 and June 14, 1999, respectively. The as-
sets deposited with ESC and the custodian under these expense offset arrange-
ment could have been invested in income-producing assets. The amount of fee
credits received by each Fund and the impact on each Fund's expense ratio rep-
resented as a percentage of its average daily net assets were as follows:
<TABLE>
<CAPTION>
Total Fee % of Average
Credits Received Daily Net Assets
---------------------------------
<S> <C> <C>
Emerging Markets Growth Fund.. $14,424 0.00%
Global Leaders Fund........... 29,542 0.01
Global Opportunities Fund..... 15,860 0.01
International Growth Fund..... 33,220 0.01
Latin America Fund............ 3,514 0.01
Perpetual International Fund.. 1,623 0.00
Precious Metals Fund.......... 4,771 0.01
</TABLE>
10. DEFERRED TRUSTEES' FEES
Each Independent Trustee of each Fund may defer any or all compensation related
to performance of their duties as Trustees. The Trustees' deferred balances are
allocated to deferral accounts, which are included in the accrued expenses for
the Fund. The investment performance of the deferral accounts are based on the
investment performance of certain Evergreen Funds. Any gains earned or losses
incurred in the deferral accounts are reported in the Fund's Trustees' fees and
expenses. Trustees will be paid either in one lump sum or in quarterly install-
ments for up to ten years at their election, not earlier than either the year
in which the Trustee ceases to be a member of the Board of Trustees or January
1, 2000.
11. FINANCING AGREEMENTS
Certain Evergreen Funds and State Street Bank and Trust Company ("State
Street") and a group of banks (collectively, the "Banks") entered into a fi-
nancing agreement dated December 22, 1997, as amended on November 20, 1998. Un-
der this agreement, the Banks provided an unsecured credit facility in the ag-
gregate amount of $400 million ($275 million committed and $125 million uncom-
mitted). The credit facility was allocated, under the terms of the financing
agreement, among the Banks. The credit facility was accessed by the Funds for
temporary or emergency purposes only and was subject to each Fund's borrowing
restrictions. Borrowings under this facility bear interest at 0.50% per annum
above the Federal Funds rate. A commitment fee of 0.065% per annum was incurred
on the unused portion of the committed facility, which was allocated to all
funds. For its assistance in arranging this financing agreement, the Capital
Markets Group of First Union was paid a one-time arrangement fee of $27,500.
State Street served as administrative agent for the Banks, and as administra-
tive agent was entitled to a fee of $20,000 per annum which was allocated to
all of the Funds.
83
<PAGE>
Combined Notes to Financial Statements (continued)
This agreement was amended and renewed on December 22, 1998. The amended fi-
nancing agreement became effective on December 22, 1998 among all of the Ever-
green Funds, State Street and The Bank of New York ("BONY"). Under this agree-
ment, State Street and BONY provide an unsecured credit facility in the aggre-
gate amount of $150 million ($125 million committed and $25 million uncommit-
ted). The remaining terms and conditions of the agreement were unaffected.
On July 27, 1999, all of the Evergreen Funds and a group of banks (the "Lend-
ers") entered into a credit agreement. On August 6, 1999, the Perpetual Inter-
national Fund became party to this credit agreement. Under this agreement, the
Lenders provide unsecured revolving credit commitment in the aggregate amount
of $1.050 billion. The credit facility is allocated, under the terms of the fi-
nancing agreement, among the Lenders. The credit facility is accessed by the
Funds for temporary of emergency purposes to fund the redemption of their
shares or a general working capital as permitted by each Fund's borrowing re-
strictions. Borrowings under this facility bear interest at 0.75% per annum
above the Federal Funds rate (1.50% per annum above the Federal Funds rate dur-
ing the period from and including December 1, 1999 through and including Janu-
ary 31, 2000). A commitment fee of 0.10% per annum is incurred on the average
daily unused portion of the revolving credit commitment. The commitment fee is
allocated to all Funds. For its assistance in arranging this financing agree-
ment, First Union Capital Markets Corp. was paid a one-time arrangement fee of
$250,000. State Street serves as paying agent for the funds and as paying agent
is entitled to a fee of $20,000 per annum which is allocated to all the Funds.
Below is a summary of the borrowing activity for each Fund that significantly
utilized the line of credit during the year ended October 31, 1999:
<TABLE>
<CAPTION>
Interest
Expense as
a % of Number of Average Weighted Maximum
Average Days the Daily Average Daily
Interest Daily Net LOC was Balance Interest Balance
Expense Assets used Outstanding Rate Outstanding
-------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Global Leaders Fund..... $516,634 0.13% 202 $8,919,759 5.71% $31,613,000
Global Opportunities
Fund................... 20,919 0.01 54 342,142 5.54 5,800,000
International Growth
Fund................... 12,651 0.00 23 234,344 5.33 12,280,000
Latin America Fund...... 785 0.00 11 15,260 5.07 965,000
Precious Metals Fund.... 31,378 0.03 81 1,937,024 5.48 4,859,000
</TABLE>
12. CONCENTRATION OF CREDIT RISK
The Funds may invest a substantial portion of its assets in an industry or sec-
tor and, therefore, may be more affected by changes in that industry or sector
than would be a comparable mutual fund that is not heavily weighed in any in-
dustry or sector.
84
<PAGE>
Independent Auditors' Report
The Board of Trustees and Shareholders
Evergreen International Trust
We have audited the accompanying statements of assets and liabilities, includ-
ing the schedules of investments of the Evergreen Emerging Markets Growth Fund,
Evergreen Global Leaders Fund, Evergreen Global Opportunities Fund, Evergreen
International Growth Fund, Evergreen Latin America Fund, Evergreen Perpetual
International Fund (formerly Mentor Perpetual International Portfolio), and Ev-
ergreen Precious Metals Fund, portfolios of Evergreen International Trust, as
of October 31, 1999, and the related statements of operations for the year then
ended, the statements of changes in net assets for each of the years in the
two-year period then ended and financial highlights for each of the years or
periods in the five-year period ended October 31, 1999 except the Evergreen
Emerging Markets Growth Fund and Evergreen Global Leaders Fund for the years
ended October 31, 1998 and prior, see below. These financial statements and fi-
nancial highlights are the responsibility of the Funds' management. Our respon-
sibility is to express an opinion on these financial statements and financial
highlights based on our audits. For the Evergreen Emerging Markets Growth Fund
and Evergreen Global Leaders Fund, the statements of changes in net assets for
the year ended October 31, 1998 and the financial highlights for each of the
years or periods in the four-year period ended October 31, 1998 were audited by
other auditors whose report dated December 11, 1998 expressed an unqualified
opinion on those financial statements and financial highlights.
We conducted our audits in accordance with generally accepted auditing stan-
dards. Those standards require that we plan and perform our audit to obtain
reasonable assurance about whether the financial statements and financial high-
lights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of Oc-
tober 31, 1999 by correspondence with the custodian and brokers. An audit also
includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement pre-
sentation. We believe that our audits provide a reasonable basis for our opin-
ion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of Ever-
green International Trust as of October 31, 1999, the results of their opera-
tions, changes in their net assets and financial highlights for the periods de-
scribed above, in conformity with generally accepted accounting principles.
KPMG LLP
Boston, Massachusetts
December 10, 1999
85
<PAGE>
Additional Information (Unaudited)
DISTRIBUTIONS TO SHAREHOLDERS
On December 22, 1999, International Growth Fund declared net investment income
dividends, payable on December 27, 1999 to shareholders of record on December
22, 1999 of $0.112, $0.057, $0.057 and $0.136 for Class A, Class B, Class C and
Class Y, respectively.
ACQUISITION OF EVEREN BY FIRST UNION
On March 25, 1999, First Union and EVEREN Capital Corporation ("EVEREN") an-
nounced an agreement to form an asset management joint venture that would com-
bine the Evergreen mutual fund complex with the Mentor Investment Group.
Under the agreement, First Union would contribute its ownership interest in Ev-
ergreen and Mentor and receive 95 percent ownership interest in the new ven-
ture.
On April 26, 1999, First Union announced an agreement to acquire EVEREN. As
part of this acquisition, Mentor would be combined with the Evergreen mutual
funds complex and Mentor Funds would convert from a series of Massachusetts
business trust to a Delaware business trust. On October 1, 1999, the acquisi-
tion of EVEREN by First Union was completed.
SPECIAL MEETING OF SHAREHOLDERS
Special meeting of the Perpetual International Growth Fund shareholders was
held on October 15, 1999. Shareholders of record on August 17, 1999 were enti-
tled to notice of and to vote at the meeting and any adjournments thereof. The
record date shares outstanding were 8,734,503, of which 4,452,277 (50.97% of
record date shares) were voted and represented at the meeting.
During the special meeting the shareholders of the Perpetual International
Growth Fund voted the following:
1. To approve an Agreement and Plan of Conversion and Termination providing for
the conversion of the Perpetual International Growth Fund into a correspond-
ing series of Evergreen International Trust, a Delaware business trust.
2. Not applicable.
3. To approve the proposed changes to the Perpetual International Growth Fund's
investment restrictions:
3A. Diversification
3B. Concentration
3C. Senior Securities
3D. Borrowing
3E. Underwriting
3F. Real Estate
3G. Commodities
3H. Lending
3I. To reclassify as non-fundamental certain fundamental restrictions that
are no longer required to be fundamental:
3I(ii). Margin purchases
3I(iii). Pledging
4. To transact any other business that may properly come before the meeting or
any adjournment thereof.
The results were as follows:
<TABLE>
<CAPTION>
Vote 1. Shares Voted % Voted
-------------------------------------------------------------
<S> <C> <C>
FOR..................................... 4,062,598 91.25%
AGAINST................................. 188,179 4.23%
ABSTAIN................................. 201,500 4.52%
-------------------------------------------------------------
TOTAL................................... 4,452,277 100.00%
</TABLE>
86
<PAGE>
Additional Information (Unaudited)
<TABLE>
<CAPTION>
Shares Shares
Shares % of Voted % of Voted % of
Vote 3. Voted FOR Voted AGAINST Voted ABSTAIN Voted
----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
3A........................... 4,076,132 91.55% 138,032 3.10% 238,113 5.35%
3B........................... 4,075,884 91.55% 138,280 3.11% 238,113 5.35%
3C........................... 4,070,202 91.42% 143,962 3.23% 238,113 5.35%
3D........................... 4,063,269 91.26% 150,895 3.39% 238,113 5.35%
3E........................... 4,062,932 91.26% 151,232 3.40% 238,113 5.35%
3F........................... 4,062,833 91.25% 151,331 3.40% 238,113 5.35%
3G........................... 4,059,463 91.18% 154,701 3.47% 238,113 5.35%
3H........................... 4,052,749 91.03% 161,415 3.63% 238,113 5.35%
3I(ii)....................... 4,070,312 91.42% 143,852 3.23% 238,113 5.35%
3I(iii)...................... 4,070,312 91.42% 143,852 3.23% 238,113 5.35%
</TABLE>
<TABLE>
<CAPTION>
Vote 4. Shares Voted % Voted
------------------------------
<S> <C> <C>
FOR 4,076,895 91.57%
AGAINST 140,762 3.16%
ABSTAIN 234,620 5.27%
------------------------------
TOTAL 4,452,277 100.00%
</TABLE>
YEAR 2000
Like other investment companies, the Funds could be adversely af-
fected if the computer systems used by the Funds' investment advisors
and the Funds' other service providers are not able to perform their
intended functions effectively after 1999 because of the inability of
computer software to distinguish the year 2000 from the year 1900.
The Funds' investment advisors are taking steps to address this po-
tential year 2000 problem with respect to the computer systems that
they use and to obtain satisfactory assurances that comparable steps
are being taken by the Funds' other major service providers. At this
time, however, there can be no assurance that these steps will be
sufficient to avoid any adverse impact on the Funds from this prob-
lem.
CHANGE IN INDEPENDENT AUDITORS
Based on the recommendation of the Audit Committee of the fund, the
Board of Trustees has determined not to retain PricewaterhouseCoopers
LLP as Emerging Markets Growth Fund's and Global Leaders Fund's inde-
pendent auditor and voted to appoint KPMG LLP for the fund's fiscal
year ended October 31, 1999. During the two previous fiscal years,
PricewaterhouseCoopers LLP audit reports contained no adverse opinion
or disclaimer of opinion; nor were its reports qualified or modified
as to uncertainty, audit scope, or accounting principle. Further, in
connection with its audits for the two most recent fiscal years and
through June 18, 1999, there were no disagreements between the funds
and PricewaterhouseCoopers LLP on any matter of accounting principles
or practices, financial statement disclosure or auditing scope or
procedure, which if not resolved to the satisfaction of
PricewaterhouseCoopers LLP would have caused it to make reference to
the disagreements in its report on the financial statements for such
years.
FEDERAL TAX STATUS OF DISTRIBUTIONS
Pursuant to section 852 of the Internal Revenue Code, the Global Op-
portunities Fund has designated aggregate and per share long-term
capital gain distributions of $12,860,611 and $1.22, respectively,
for the fiscal year ended October 31, 1999.
87
<PAGE>
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800.346.3858
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800.343.2898
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