SUPPLEMENT TO THE PROSPECTUS
OF
EVERGREEN CAPITAL PRESERVATION AND INCOME FUND
(the "Fund")
The Prospectus of the Fund is hereby supplemented as follows:
Investment Objectives and Policies
The Fund may invest in fixed-rate and adjustable-rate collateralized
mortgage obligations ("CMOs"), including CMOs with rates that move inversely to
market rates. CMOs are securities collateralized by mortgages, mortgage
pass-throughs, mortgage pay-through bonds (bonds representing an interest in a
pool of mortgages where the cash flow generated from the mortgage collateral
pool is dedicated to bond repayment), and mortgage-backed bonds (general
obligations of the issuers payable out of the issuers' general funds and
additionally secured by a first lien on a pool of single family detached
properties). The Fund may invest in CMOs that are either issued by and
guaranteed as to principal and interest by the U.S. government, its agencies or
instrumentalities, or are issued by private issuers. Although some of the
mortgages underlying CMOs may be supported by various types of insurance, and
some CMOs may be backed by GNMA certificates or other mortgage pass-throughs
issued or guaranteed by U.S. Government agencies or instrumentalities, the CMOs
themselves are not generally guaranteed.
Dated February 13, 1998
