[LOGO]
Evergreen Select
Money Market Fund
&
Municipal Money Market Fund
offered through the
U S A A
Asset
Management
Account
July 1, 1999, as amended October 1, 1999
and May 1, 2000
Prospectus
The Securities and Exchange Commission has not approved or disapproved
the Funds' shares, or determined if this prospectus is accurate
or complete. It is a criminal offense to state otherwise.
<PAGE>
TABLE OF CONTENTS
FUND RISK/RETURN SUMMARIES:
<TABLE>
<S> <C>
Overview of Fund Risks...................................................... 1
Evergreen Select Money Market Fund.......................................... 3
Evergreen Select Municipal Money Market Fund................................ 6
</TABLE>
GENERAL INFORMATION:
<TABLE>
<S> <C>
The Funds' Investment Advisor............................................... 10
Calculating the Share Price................................................. 10
How to Choose an Evergreen Fund............................................. 11
How to Buy Shares........................................................... 11
How to Redeem Shares........................................................ 13
Other Services.............................................................. 15
The Tax Consequences of Investing in the Funds.............................. 15
Fees and Expenses of the Funds.............................................. 17
Financial Highlights........................................................ 18
Other Fund Practices........................................................ 19
</TABLE>
In general, Funds included in this prospectus seek to provide investors with
current income consistent with stability of principal and liquidity.
Fund Summaries Key
Each Fund's summary is organized around the following basic topics
and questions:
[GRAPHIC]
INVESTMENT GOAL
What is the Fund's financial objective? You can find
clarification on how the Fund seeks to achieve its objective by
looking at the Fund's strategy and investment policies. The Fund's
Board of Trustees can change the investment objective without a
shareholder vote.
[GRAPHIC]
INVESTMENT STRATEGY
How does the Fund go about trying to meet its goals? What types
of investments does it contain? What style of investing and
investment philosophy does it follow? Does it have limits on the
amount invested in any particular type of security?
[GRAPHIC]
RISK FACTORS
What are the specific risks for an investor in the Fund?
[GRAPHIC]
PERFORMANCE
How well has the Fund performed in the past year? The past five
years? The past ten years?
[GRAPHIC]
EXPENSES
How much does it cost to invest in the Fund? What is the
difference between sales charges and expenses?
<PAGE>
OVERVIEW OF FUND RISKS
Select Money Market Funds
typically rely on a combination of the following strategies:
. maintaining $1.00 per share net asset value;
. investing in high-quality, short-term money market instruments including
U.S. government securities;
. investing in compliance with industry-standard requirements for money
market funds for the quality, maturity and diversification of investments;
and
. selling a portfolio investment when the investment no longer appears to
meet the Fund's investment objective, when the Fund must meet redemptions,
or for other reasons which the portfolio manager deems necessary.
may be appropriate for investors who:
. are seeking a conservative investment which invests in relatively safe
securities;
. are seeking a Fund for short-term investment; and
. are seeking liquidity.
Following this overview, you will find information on each Fund's specific
investment strategies and risks.
................................................................................
Risk Factors For All Mutual Funds
Please remember that mutual fund shares are:
. not guaranteed to achieve their investment goal
. not insured, endorsed or guaranteed by the FDIC, a bank or any
government agency
. subject to investment risks, including possible loss of your original
investment
Although Select Money Market Funds seek to preserve the value of your
investment at $1.00 per share, it is possible to lose money by
investing in the Funds.
SELECT MONEY MARKET FUNDS
1
<PAGE>
OVERVIEW OF FUND RISKS
Here are the most important factors that may affect the value of your
investment:
Interest Rate Risk
When interest rates go up, the value of debt securities tends to fall.
Since your Fund invests a significant portion of its portfolio in debt
securities, if interest rates rise, then the value of your investment
may decline. When interest rates go down, interest earned by your Fund
on its investments may also decline, which could cause the Fund to
reduce the dividends it pays.
Credit Risk
The value of a debt security is directly affected by the issuer's
ability to repay principal and pay interest on time. Since your Fund
invests in debt securities, the value of your investment may decline if
an issuer fails to pay an obligation on a timely basis.
SELECT MONEY MARKET FUNDS
2
<PAGE>
EVERGREEN
Select Money Market Fund
[GRAPHIC]
INVESTMENT GOAL
The Fund seeks as high a level of current income as is consistent with
preserving capital and providing liquidity.
[GRAPHIC]
INVESTMENT STRATEGY
The following supplements the investment strategies discussed in the "Overview
of Fund Risks" on page 1.
The Fund invests principally in short-term corporate debt securities determined
to present minimal credit risk. In addition, the Fund may invest in short-term
securities issued or guaranteed by the U.S. government or its agencies or
instrumentalities, including the Interamerican Development Bank and the
International Bank for Reconstruction and Development. The Fund may also invest
in commercial paper and bank obligations. The portfolio manager focuses
primarily on the interest rate environment in determining which securities to
purchase for the portfolio. Generally, as interest rates go up, the Fund will
invest in securities of shorter maturities. If interest rates are high, the
Fund will invest in securities with longer maturities; however, the Fund will
not acquire any security with a remaining maturity of greater than 397 days.
[GRAPHIC]
RISK FACTORS
Your investment in the Fund is subject to the risks discussed in the "Overview
of Fund Risks" on page 1 under the headings:
.Interest Rate Risk
.Credit Risk
Because obligations of the Interamerican Development Bank and the International
Bank of Reconstruction and Development are supported only by appropriated but
unpaid commitments of member countries, there is no assurance that the
commitments will be undertaken in the future.
For further information regarding the Fund's investment strategy and risk
factors see "Other Fund Practices."
FUND FACTS:
Goal: Investment Advisor:
.High Current Income . Evergreen Investment Management
. Preservation of Capital Liquidity
NASDAQ Symbol:
Principal Investment: . EMSXX
. Short-term Corporate Debt Securities
Dividend Payment Schedule:
Class of Shares Offered in this Prospectus: . Monthly
.Institutional Service
SELECT MONEY MARKET FUNDS
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<PAGE>
EVERGREEN
[GRAPHIC]
PERFORMANCE
The following charts show how the Fund has performed in the past. Past
performance is not an indication of future results.
The chart below shows the percentage gain or loss for Institutional Service
shares of the Fund in each calendar year since the Institutional Service
shares' inception on 11/26/1996. It should give you a general idea of how the
Fund's return has varied from year-to-year. This graph includes the effects of
Fund expenses.
Year-by-Year Total Return for Institutional Service Shares (%)
[GRAPH]
1989
1990
1991
1992
1993
1994
1995
1996
1997 5.44
1998 5.36
Best Quarter:3rd Quarter 1997 +1.37%
Worst Quarter:1st Quarter 1997 +1.28%
Year to date total return through 6/30/1999 is +2.35%.
The next table lists the Fund's average annual total return over the past one
year and since inception (through 12/31/1998). This table is intended to
provide you with some indication of the risks of investing in the Fund.
Average Annual Total Return
(for the period ended 12/31/1998)
<TABLE>
<CAPTION>
Inception Performance
Date Since
of Class 1 year 5 year 10 year Class Inception
<S> <C> <C> <C> <C> <C>
Institutional Service 11/26/1996 5.36% N/A N/A 5.41%
</TABLE>
To obtain current yield information call 1-800-343-2898.
SELECT MONEY MARKET FUNDS
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<PAGE>
EVERGREEN
[GRAPHIC]
EXPENSES
This section describes the fees and expenses you would pay if you bought and
held shares of the Fund.
You pay no shareholder transaction fees.
Annual Fund Operating Expenses (expenses that are deducted from Fund assets)*
<TABLE>
<CAPTION>
Management 12b-1 Other Total Fund
Fees Fees Expenses Operating Expenses**
<S> <C> <C> <C> <C>
Institutional Service 0.15% 0.25% 0.07% 0.47%
</TABLE>
*Actual expenses for the fiscal year ended 2/28/1999.
**From time to time, the Fund's investment advisor may, at its discretion,
reduce or waive its fees or reimburse a Fund for certain of its expenses in
order to reduce expense ratios. The Fund's investment advisor may cease these
waivers or reimbursements at any time. The annual operating expenses do not
reflect fee waivers and expense reimbursements. Including current fee waivers
and expense reimbursements, Total Fund Operating Expenses were 0.46%.
The table below shows the total expenses you would pay on a $10,000 investment
over one-, three-, five- and ten-year periods. The example is intended to help
you compare the cost of investing in this Fund versus other mutual funds and is
for illustration only. The example assumes a 5% average annual return and that
you reinvest all of your dividends. Your actual costs may be higher or lower.
Example of Fund Expenses
<TABLE>
<S> <C>
After 1 year $48
After 3 years $151
After 5 years $263
After 10 years $592
</TABLE>
SELECT MONEY MARKET FUNDS
5
<PAGE>
EVERGREEN
Select Municipal Money Market Fund
[GRAPHIC]
INVESTMENT GOAL
The Fund seeks as high a level of current income exempt from federal income tax
as is consistent with preserving capital and providing liquidity.
[GRAPHIC]
INVESTMENT STRATEGY
The following supplements the investment strategies discussed in the "Overview
of Fund Risks" on page 1.
The Fund invests principally in short-term municipal money market securities,
notes and commercial paper determined to present minimal credit risk and issued
by any U.S. state, the District of Columbia and their political subdivisions.
Under normal circumstances, at least 80% of the Fund's annual interest income
will be exempt from federal income tax, other than the alternative minimum tax.
The Fund may temporarily invest up to 20% of its net assets in taxable
securities under one or more of the following circumstances: (a) pending
investment of proceeds from sale of Fund shares or of portfolio securities; (b)
pending settlement of purchases of portfolio securities, and (c) to maintain
liquidity for the purpose of meeting anticipated redemptions. The Fund may
temporarily invest more than 20% of its total assets in taxable securities for
defensive purposes which may result in the Fund not achieving its investment
objective. In determining what securities to purchase for the portfolio the
portfolio manager focuses on the supply and demand of the security in the
market place as well as the current interest rate environment. Generally, as
interest rates go up, the Fund will invest in securities of shorter maturities.
If interest rates are high, the Fund will invest in securities with longer
maturities; however, the Fund will not acquire any security with a remaining
maturity of greater than 397 days.
SELECT MONEY MARKET FUNDS
6
<PAGE>
EVERGREEN
[GRAPHIC]
RISK FACTORS
Your investment in the Fund is subject to the risks discussed in the "Overview
of Fund Risks" on page 1 under the headings:
.Interest Rate Risk
.Credit Risk
For further information regarding the Fund's investment strategy and risk
factors see "Other Fund Practices."
FUND FACTS:
Goal: Investment Advisor:
. High Current Income Exempt . Evergreen Investment Management
from Federal Tax
. Preservation of Capital NASDAQ Symbol:
. Liquidity .EISXX
Principal Investment: Dividend Payment Schedule:
. Municipal Money Market Securities .Monthly
Class of Shares Offered in this Prospectus:
. Institutional Service
SELECT MONEY MARKET FUNDS
7
<PAGE>
EVERGREEN
[GRAPHIC]
PERFORMANCE
The following charts show how the Fund has performed in the past. Past
performance is not an indication of future results.
The chart below shows the percentage gain or loss for Institutional Service
shares of the Fund in each calendar year since the Institutional Service
shares' inception on 11/25/1996. It should give you a general idea of how the
Fund's return has varied from year-to-year. This graph includes the effects of
Fund expenses.
Year-by-Year Total Return for Institutional Service Shares (%)
[GRAPH]
1989
1990
1991
1992
1993
1994
1995
1996
1997 3.40
1998 3.35
Best Quarter:2nd Quarter 1997 +0.90%
Worst Quarter:1st Quarter 1997 +0.75%
Year to date total return through 6/30/1999 is +1.47%.
The next table lists the Fund's average annual total return over the past one
year and since inception (through 12/31/1998). This table is intended to
provide you with some indication of the risks of investing in the Fund.
Average Annual Total Return
(for the period ended 12/31/1998)
<TABLE>
<CAPTION>
Inception Performance
Date Since
of Class 1 year 5 year 10 year Class Inception
<S> <C> <C> <C> <C> <C>
Institutional Service 11/25/1996 3.35% N/A N/A 3.38%
</TABLE>
To obtain current yield information call 1-800-343-2898.
SELECT MONEY MARKET FUNDS
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<PAGE>
EVERGREEN
[GRAPHIC]
EXPENSES
This section describes the fees and expenses you would pay if you bought and
held shares of the Fund.
You pay no shareholder transaction fees.
Annual Fund Operating Expenses
(expenses that are deducted from Fund assets)*
<TABLE>
<CAPTION>
Management 12b-1 Other Total Fund
Fees Fees Expenses Operating Expenses**
<S> <C> <C> <C> <C>
Institutional Service 0.15% 0.25% 0.09% 0.49%
</TABLE>
*Actual expenses for the fiscal year ended 2/28/1999.
**From time to time, the Fund's investment advisor may, at its discretion,
reduce or waive its fees or reimburse a Fund for certain of its expenses in
order to reduce expense ratios. The Fund's investment advisor may cease these
waivers or reimbursements at any time. The annual operating expenses do not
reflect fee waivers and expense reimbursements. Including current fee waivers
and expense reimbursements, Total Fund Operating Expenses were 0.42%.
The table below shows the total expenses you would pay on a $10,000 investment
over one-, three-, five- and ten-year periods. The example is intended to help
you compare the cost of investing in this Fund versus other mutual funds and is
for illustration only. The example assumes a 5% average annual return and that
you reinvest all of your dividends. Your actual costs may be higher or lower.
Example of Fund Expenses
<TABLE>
<S> <C>
After 1 year $50
After 3 years $157
After 5 years $274
After 10 years $616
</TABLE>
SELECT MONEY MARKET FUNDS
9
<PAGE>
EVERGREEN
THE FUNDS' INVESTMENT ADVISOR
An investment advisor manages a Fund's investments and supervises its daily
business affairs. The investment advisor for the Evergreen Select Money Market
Funds is Evergreen Investment Management. All investment advisors for the
Evergreen Funds are subsidiaries of First Union Corporation, the sixth largest
bank holding company in the United States, with over $230 billion in
consolidated assets as of 6/30/1999. First Union Corporation is located at 301
South College Street, Charlotte, North Carolina 28288-0013.
Evergreen Investment Management (EIM)
(formerly known as Capital Management Group, or CMG), a division of First Union
National Bank (FUNB), has been managing money for over 50 years and currently
manages over $28.8 billion in assets for 44 of the Evergreen Funds. EIM is
located at 201 South College Street, Charlotte, North Carolina 28288-0630.
For the fiscal year ended 2/28/1999, aggregate advisory fees paid to EIM by
each Fund were as follows:
<TABLE>
<CAPTION>
% of the Fund's average
Fund daily net assets
<S> <C>
Money Market 0.14%
Municipal Money Market 0.09%
</TABLE>
Year 2000 Compliance
The investment advisors and other service providers for the Evergreen Funds are
taking steps to address any potential Year 2000-related computer problems.
However, there is some risk that these problems could disrupt the Funds'
operations or financial markets generally. In addition, issuers of securities
in which the Funds may invest may be adversely affected by Year 2000 problems.
Such problems could negatively impact the value of the Funds' securities.
CALCULATING THE SHARE PRICE
The value of one share of a Fund, also known as the net asset value, or NAV, is
calculated twice daily on each day the New York Stock Exchange is open
(normally 12 noon Eastern time) and as of the time the Exchange closes
(normally 4 p.m. Eastern time). The share price is calculated for each share by
adding up the total assets of the Fund, subtracting all liabilities, then
dividing the result by the total number of shares outstanding. Each class of
shares is calculated separately. Each security held by a Fund is valued on an
amortized cost basis according to Rule 2a-7 under the Investment Company Act of
1940. Under this
SELECT MONEY MARKET FUNDS
10
<PAGE>
EVERGREEN
method of valuation, a security is initially valued at its acquisition cost,
and thereafter a constant straightline amortization of any discount or premium
is assumed each day regardless of the impact of fluctuating interest rates on
the market value of the security.
The price per share you pay for a Fund purchase or the amount you receive for a
Fund redemption is based on the next price calculated after the order is
received and all required information is provided. The value of your account at
any given time is the latest share price multiplied by the number of shares you
own.
HOW TO CHOOSE AN EVERGREEN FUND
When choosing an Evergreen Fund, you should:
. Most importantly, read the prospectus to see if the Fund is suitable for you.
. Consider talking to an investment professional. He or she is qualified to
give you investment advice based on your investment goals and financial
situation and will be able to answer questions you may have after reading the
Fund's prospectus. He or she can also assist you through all phases of
opening your account.
. Request any additional information you want about the Fund, such as the
Statement of Additional Information, Annual Report or Semi-annual Report by
calling 1-800-343-2898.
HOW TO BUY SHARES
After choosing a Fund, you select a share class. The Funds offer two different
institutional classes. Institutional Service shares are offered in this
prospectus. Institutional shares are offered in a separate prospectus.
Institutional shares are only offered to investment advisory clients of an
investment advisor of an Evergreen Fund (or the advisor's affiliates).
Institutional Service shares are sold without a front-end sales charge or
contingent deferred sales charge but they do pay an ongoing service fee. The
minimum initial investment is $1 million, which may be waived in certain
situations. There is no minimum amount required for subsequent purchases.
Each Fund has adopted for its Institutional Service shares a distribution plan
which provides for the payment of an annual service fee of up to 0.25% of the
average daily net assets of the class for personal services rendered to
shareholders and/or the maintenance of accounts.
Institutional investors may buy shares through broker-dealers, banks and
certain other financial intermediaries, or directly through the Funds'
distributor, Evergreen Distributor, Inc. (EDI).
SELECT MONEY MARKET FUNDS
11
<PAGE>
EVERGREEN
Method Opening an Account Adding to an Account
By Phone . Call 1-800-343-2898 to set up an . Call the Evergreen
account number and get wiring Express Line at
instructions (call before 12 1-800-346-3858 24
noon if you want wired funds to hours a day or
be credited that day). 1-800-343-2898
. Instruct your bank to wire or between 8 a.m. and 6
transfer your purchase (they may p.m. Eastern time,
charge a wiring fee). on any business day.
. Complete the account application . If your bank account
and mail to: is set up on file,
you can request
Evergreen Service Company either:
P.O. Box 2121 - Federal Funds Wire
Boston, MA 02106-2121 (offers immediate
access to funds) or
Overnight Address: - Electronic transfer
Evergreen Service Company through the
200 Berkeley St. Automated Clearing
Boston, MA 02116-5039 House which avoids
. Wires received after 4 p.m. wiring fees.
Eastern time on market trading
days will receive the next
market day's closing price.*
By Exchange . You can make an additional investment by exchange from an
existing Evergreen Funds account by contacting your
investment representative or calling the Evergreen Express
Line at 1-800-346-3858.**
. You can only exchange shares within the same class.
. There is no sales charge or redemption fee when exchanging
funds within the Evergreen Funds family.
. Orders placed before 4 p.m. Eastern time on market trading
days will receive that day's closing share price (if not,
you will receive the next market day's closing price).*
. Exchanges are limited to three per calendar quarter, but
in no event more than five per calendar year.
. Exchanges between accounts which do not have identical
ownership must be made in writing with a signature
guarantee (see below).
*The Fund's shares may be made available through financial service
firms which are also investment dealers and which have a service
agreement with EDI. The Fund has approved the acceptance of purchase
and repurchase request orders effective as of the time of their receipt
by certain authorized financial intermediaries.
**Once you have authorized either the telephone exchange or redemption
service, anyone with a Personal Identification Number (PIN) and the
required account information (including your broker) can request a
telephone transaction in your account. All calls are recorded or
monitored for verification, recordkeeping and quality-assurance
purposes. The Evergreen Funds reserve the right to terminate the
exchange privilege of any shareholder who exceeds the listed maximum
number of exchanges.
SELECT MONEY MARKET FUNDS
12
<PAGE>
EVERGREEN
HOW TO REDEEM SHARES
We offer you several convenient ways to redeem your shares in any of the
Evergreen Funds:
Methods Requirements
Call Us . Call the Evergreen Express Line at 1-800-346-3858 24
hours a day or 1-800-343-2898 between 8 a.m. and 6 p.m.
Eastern time, on any business day.
. This service must be authorized ahead of time, and is
only available for regular accounts.**
. All authorized requests made before 4 p.m. Eastern time
on market trading days will be processed at that day's
closing price. Requests after 4 p.m. will be processed
the following business day.*
. We can either:
- wire the proceeds into your bank account (service
charges may apply)
- electronically transmit the proceeds to your bank
account via the Automated Clearing House service
- mail you a check.
. All telephone calls are recorded for your protection. We
are not responsible for acting on telephone orders we
believe are genuine.
. See exceptions list below for requests that must be made
in writing.
Write Us . You can mail a redemption request to:
Evergreen Service Company Overnight Address:
P.O. Box 2121 Evergreen Service Company
Boston, MA 02106-2121 200 Berkeley St.
Boston, MA 02116-5039
. Your letter of instructions must:
- list the Fund name and the account number
- indicate the number of shares or dollar value you wish
to redeem
- be signed by the registered owner(s)
. See exceptions list below for requests that must be
signature guaranteed.
Redeem Your . You may also redeem your shares through participating
Shares in broker-dealers by delivering a letter as described above
Person to your broker-dealer.
. A fee may be charged for this service.
*The Fund's shares may be made available through financial service
firms which are also investment dealers and which have a service
agreement with EDI. The Fund has approved the acceptance of purchase
and repurchase request orders effective as of the time of their receipt
by certain authorized financial intermediaries.
**Once you have authorized either the telephone exchange or redemption
service, anyone with a Personal Identification Number (PIN) and the
required account information (including your broker) can request a
telephone transaction in your account. All calls are recorded or
monitored for verification, recordkeeping and quality-assurance
purposes. The Evergreen Funds reserve the right to terminate the
exchange privilege of any shareholder who exceeds the listed maximum
number of exchanges.
SELECT MONEY MARKET FUNDS
13
<PAGE>
EVERGREEN
Timing of Proceeds
Normally, we will send your redemption proceeds on the next business day after
we receive your request; however, we reserve the right to wait up to seven
business days to redeem any investments made by check and five business days
for investments made by Automated Clearing House transfer. We also reserve the
right to redeem in kind by paying you the proceeds of a redemption in
securities rather than in cash, and to redeem the remaining amount in the
account if your redemption brings the account balance below the initial minimum
of $1,000,000.
Exceptions: Redemption Requests That Require A Signature Guarantee
To protect you and the Evergreen Funds against fraud, certain redemption
requests must be made in writing with your signature guaranteed. A signature
guarantee can be obtained at most banks and securities dealers. A notary public
is not authorized to provide a signature guarantee. The following circumstances
require signature guarantees:
. You want the proceeds transmitted Who Can Provide A Signature Guarantee:
to a bank account not listed on .Commercial Bank
the account .Trust Company
. You want the proceeds payable to .Savings Association
anyone other than the registered .Credit Union
owner(s) of the account .Member of a U.S. stock exchange
. Either your address or the
address of your bank account has
been changed within 30 days
SELECT MONEY MARKET FUNDS
14
<PAGE>
EVERGREEN
OTHER SERVICES
Evergreen Express Line
Use our automated, 24-hour service to check the value of your investment in a
Fund; purchase, redeem or exchange Fund shares; find a Fund's price, yield or
total return; order a statement or duplicate tax form; or hear market
commentary from Evergreen portfolio managers.
Automatic Reinvestment of Dividends
For the convenience of investors, all dividends and capital gains distributions
are automatically reinvested, unless you request otherwise. Distributions can
be made by check or electronic transfer through the Automated Clearing House to
your bank account. The details of your dividends and other distributions will
be included on your statement.
Telephone Investment Plan
You may make additional investments electronically in an existing Fund account.
Telephone requests received by 4 p.m. Eastern time will be invested the day the
request is received.
Reinvestment Privileges
Under certain circumstances, shareholders may, within one year of redemption,
reinstate their accounts at the current price. This is the Fund's net asset
value, also sometimes referred to as the Fund's "NAV."
THE TAX CONSEQUENCES OF INVESTING IN THE FUNDS
You may be taxed in two ways:
. On Fund distributions (dividends and capital gains)
. On any profit you make when you sell any or all of your shares.
Fund Distributions
A mutual fund passes along to all of its shareholders the net income or profits
it receives from its investments. The shareholders of the Fund then pay any
taxes due, whether they receive these distributions in cash or elect to have
them reinvested. The Select Municipal Money Market Fund expects that
substantially all of its regular dividends will be exempt from federal income
tax other than the alternative minimum tax. Otherwise, the Funds will
distribute two types of taxable income to you:
. Dividends. To the extent that regular dividends are derived from interest
that is not tax exempt, or from short-term capital gains, you will have to
include them in your federal taxable income. Each Fund pays a monthly
dividend from the dividends, interest and other income on the securities in
which it invests.
SELECT MONEY MARKET FUNDS
15
<PAGE>
EVERGREEN
. Capital Gains. When a mutual fund sells a security it owns for a profit, the
result is a capital gain. Evergreen Select Money Market Funds generally
distribute capital gains, if any, at least once a year, near the end of the
calendar year. Short-term capital gains reflect securities held by the Fund
for a year or less and are considered ordinary income just like dividends.
Profits on securities held longer than 12 months are considered long-term
capital gains and are taxed at a special tax rate (20% for most taxpayers).
It is not anticipated that any significant capital gains will be realized by
the Funds.
Dividend and Capital Gain Reinvestment
Unless you choose otherwise on the account application, all dividend and
capital gain payments will be reinvested to buy additional shares. Distribution
checks that are returned and distribution checks that are uncashed when the
shareholder has failed to respond to mailings from the shareholder servicing
agent will automatically be reinvested to buy additional shares.
No interest will accrue on amounts represented by uncashed distribution or
redemption checks.
We will send you a statement each January with the federal tax status of
dividends and distributions paid by each Fund during the previous calendar
year.
Profits You Realize When You Redeem Shares
When you sell shares in a mutual fund, whether by redeeming or exchanging, you
have created a taxable event. You must report any gain or loss on your tax
return unless the transaction was entered into by a tax-deferred retirement
plan. Investments in money market funds typically do not generate capital
gains. It is your responsibility to keep accurate records of your mutual fund
transactions. You will need this information when you file your income tax
return, since you must report any capital gains or losses you incur when you
sell shares. Remember, an exchange is a purchase and a sale for tax purposes.
Tax Reporting
Evergreen Service Company provides you with a tax statement of your dividend
and capital gains distributions for each calendar year on Form 1099 DIV.
Proceeds from a sale are reported on Form 1099B. You must report these on your
tax return. Since the IRS receives a copy as well, you could pay a penalty if
you neglect to report them.
Evergreen Service Company will send you a tax information guide each year
during tax season, which may include a cost basis statement detailing the gain
or loss on taxable transactions you had during the year. Please consult your
own tax
SELECT MONEY MARKET FUNDS
16
<PAGE>
EVERGREEN
advisor for further information regarding the federal, state and local tax
consequences of an investment in the Funds.
FEES AND EXPENSES OF THE FUNDS
Every mutual fund has fees and expenses that are assessed either directly or
indirectly. This section describes each of those fees.
Management Fee
The management fee pays for the normal expenses of managing the Fund, including
portfolio manager salaries, research costs, corporate overhead expenses and
related expenses.
12b-1 Fees
The Trustees of the Evergreen Funds have approved a policy to assess 12b-1 fees
for Institutional Service shares. Up to 0.75% of the Institutional Service
shares' average daily net assets are payable as a 12b-1 fee. However, currently
the 12b-1 fees are limited to 0.25% of the Institutional Service shares'
average daily net assets. These fees will increase the cost of your investment.
A Fund may use this fee as a "service fee" to pay broker-dealers for additional
shareholder services and/or the maintenance of accounts.
Other Expenses
Other expenses include miscellaneous fees from affiliated and outside service
providers. These may include legal, audit, custodial and safekeeping fees, the
printing and mailing of reports and statements, automatic reinvestment of
distributions and other conveniences for which the shareholder pays no
transaction fees.
Total Fund Operating Expenses
The total cost of running the Fund is called the expense ratio. As a
shareholder, you are not charged these fees directly; instead they are taken
out before the Fund's net asset value is calculated, and are expressed as a
percentage of the Fund's average daily net assets. The effect of these fees is
reflected in the performance results for that share class. Because these fees
are "invisible," investors should examine them closely in the prospectus,
especially when comparing one fund with another fund in the same investment
category. There are three things to remember about expense ratios: 1) your
total return in the Fund is reduced in direct proportion to the fees; 2)
expense ratios can vary greatly between funds and fund families, from under
0.25% to over 3.0%; and 3) the Fund's advisor may waive a portion of the Fund's
expenses for a period of time, reducing its expense ratio.
SELECT MONEY MARKET FUNDS
17
<PAGE>
EVERGREEN
FINANCIAL HIGHLIGHTS
This section looks in detail at the results for one share in the Institutional
Service shares of the Funds--how much income it earned, how much of this income
was passed along as a distribution and how much the return was reduced by
expenses. The tables for the Funds have been derived from financial statements
audited by PricewaterhouseCoopers LLP, the Funds' independent accountants. For
a more complete picture of the Funds' financial statements, please see the
Funds' Annual Report as well as the Statement of Additional Information.
- --------------------------------------------------------------------------------
SELECT MONEY MARKET FUND
<TABLE>
<CAPTION>
Year Ended February 28,
--------------------------------
1999 1998 1997 (a)
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
Net asset value, beginning of period $ 1.00 $ 1.00 $ 1.00
---------- ---------- --------
Income from investment operations
Net investment income 0.051 0.053 0.014
Less distributions to shareholders from
net investment income (0.051) (0.053) (0.014)
---------- ---------- --------
Net asset value, end of period $ 1.00 $ 1.00 $ 1.00
---------- ---------- --------
Total return 5.27% 5.45% 1.40%
Ratios and supplemental data
Net assets, end of period (thousands) $2,242,693 $1,215,348 $867,294
Ratios to average net assets
Expenses 0.46% 0.45% 0.32%+
Net investment income 5.12% 5.33% 5.24%+
</TABLE>
- --------------------------------------------------------------------------------
SELECT MUNICIPAL MONEY MARKET FUND
<TABLE>
<CAPTION>
Year Ended February 28,
---------------------------
1999 1998 1997 (b)
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
Net asset value, beginning of period $ 1.00 $ 1.00 $ 1.00
-------- ------- -------
Income from investment operations
Net investment income 0.032 0.034 0.008
Less distributions to shareholders from
net investment income (0.032) (0.034) (0.008)
-------- ------- -------
Net asset value, end of period $ 1.00 $ 1.00 $ 1.00
-------- ------- -------
Total return 3.27% 3.41% 0.85%
Ratios and supplemental data
Net assets, end of period (thousands) $144,002 $61,778 $14,295
Ratios to average net assets
Expenses 0.42% 0.35% 0.30%+
Net investment income 3.17% 3.34% 3.19%+
................................................................................
</TABLE>
(a) For the period from November 26, 1996 (commencement of class operations) to
February 28, 1997.
(b) For the period from November 25, 1996 (commencement of class operations) to
February 28, 1997.
+ Annualized.
SELECT MONEY MARKET FUNDS
18
<PAGE>
EVERGREEN
OTHER FUND PRACTICES
The Funds may borrow money as a temporary measure for extraordinary or
emergency purposes, such as the redemption of Fund shares. The Funds may also
lend their securities. Borrowing is a form of leverage that may magnify a
Fund's gain or loss. Lending securities may cause the Fund to lose the
opportunity to sell these securities at the most desirable price and,
therefore, lose money.
Please consult the Statement of Additional Information for more
information regarding these and other investment practices used by the
Funds, including risks.
SELECT MONEY MARKET FUNDS
19
<PAGE>
EVERGREEN
Evergreen Select Funds
Select Money Market
Select Money Market Fund
Select Treasury Money Market Fund
Select Municipal Money Market Fund
Select U.S. Government Money Market Fund
Select 100% Treasury Money Market Fund
Select Fixed Income
Select Adjustable Rate Fund
Select Core Bond Fund
Select Fixed Income Fund
Select Income Plus Fund
Select Intermediate Term Municipal Bond Fund
Select International Bond Fund
Select Limited Duration Fund
Select Total Return Bond Fund
Select High Yield Bond Fund
Select Equity Trust
Select Strategic Value Fund
Select Large Cap Blend Fund
Select Strategic Growth Fund
Select Social Principles Fund
Select Small Company Value Fund
Select Core Equity Fund
Select Small Cap Growth Fund
Select Balanced Fund
Select Diversified Value Fund
Select Special Equity Fund
Select Equity Index Fund
Select Secular Growth Fund
Express Line
800.346.3858
Investor Services
800.343.2898
www.evergreen-funds.com
SELECT MONEY MARKET FUNDS
20
<PAGE>
QUICK REFERENCE GUIDE
1 Evergreen Express Line
Call 1-800-346-3858
24 hours a day to
. check your account
. order a statement
. get a Fund's current price, yield and total return
. buy, redeem or exchange Fund shares
2 Shareholder Services
Call 1-800-343-2898
Each business day, 8 a.m. to 6 p.m. Eastern time to
. buy, redeem or exchange shares
. order applications
. get assistance with your account
3 Information Line for Hearing and Speech Impaired (TTY/TDD)
Call 1-800-343-2888
Each business day, 8 a.m. to 6 p.m. Eastern time
4 Write us a letter
Evergreen Service Company
P.O. Box 2121
Boston, MA 02106-2121
. to buy, redeem or exchange shares
. to change the registration on your account
. for general correspondence
5 For express, registered or certified mail:
Evergreen Service Company
200 Berkeley Street
Boston, MA 02116-5039
6 Visit us on-line:
www.evergreen-funds.com
7 Regular communications you will receive:
Account Statements -- You will receive quarterly statements for each
Fund you own.
Confirmation Notices -- We send a confirmation of any transaction you
make within five days of the transaction.
Annual and Semi-annual reports -- You will receive a detailed
financial report on your Fund(s) twice a year.
Tax Forms -- Each January you will receive any tax forms you need to
file your taxes as well as the Evergreen Tax Information Guide.
<PAGE>
For More Information about the Evergreen Select Money Market Funds, Ask for:
The Funds' most recent Annual or Semi-annual Report, which contains a complete
financial accounting for each Fund and a complete list of the Fund's holdings
as of a specific date, as well as commentary from the Fund's portfolio manager.
This Report discusses the market conditions and investment strategies that
significantly affected the Fund's performance during the most recent fiscal
year or period.
The Statement of Additional Information (SAI), which contains more detailed
information about the policies and procedures of the Funds. The SAI has been
filed with the Securities and Exchange Commission (SEC) and its contents are
legally considered to be part of this prospectus.
For questions, other information, or to request a copy, without charge, of any
of the documents, call 1-800-343-2898 or ask your investment representative. We
will mail material within three business days.
Information about these Funds (including the SAI) is also available on the
SEC's Internet web site at http://www.sec.gov, or, for a duplication fee, by
writing the SEC Public Reference Section, Washington DC 20549-6009. This
material can also be reviewed and copied at the SEC's Public Reference Room in
Washington, DC. For more information, call the SEC at 1-800-SEC-0330.
Evergreen Distributor, Inc.
90 Park Avenue
New York, New York 10016
67681 SEC File No. 811-08405
36029-0500
