EVERGREEN GLOBAL EQUITY TRUST /NY, 485APOS, 1998-02-04

EVERGREEN GLOBAL EQUITY TRUST /NY
485APOS, 1998-02-04

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<PAGE>

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------------------

FORM N-1A

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [X]
Pre-Effective Amendment No. [ ]
Post-Effective Amendment No. 17 [X]
and
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [X]
Amendment No. 17 [X]
(Check appropriate box or boxes.)

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

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

(Registrant's Telephone Number, Including Area Code (800) 343-2898)

Samuel A. Lieber
Alpine Management & Research, LLC
2500 Westchester Avenue, Purchase, N.Y. 10577
(Name and address of Agent for Service)

Copy to:

Kenneth S. Gerstein, Esq.
Schulte Roth & Zabel LLP
900 Third Avenue
New York, New York 10022

Approximate Date of Proposed Public Offering:
As soon as practicable after this Post-Effective Amendment becomes effective.

It is proposed that this filing will become effective (check appropriate box)
/ / immediately upon filing pursuant to paragraph (b)
/ / on (date) pursuant to paragraph (b)
/X/ 60 days after filing pursuant to paragraph (a)(1)
/ / on (date) pursuant to paragraph (a) of rule 485
/ / 75 days after filing pursuant to paragraph (a)(2)
/ / on (date) pursuant to paragraph (a)(2) of rule 485
If appropriate, check the following box:
/ / this post-effective amendment designates a new effective date for a
previously filed post-effective amendment.

[cad 157]

<PAGE>

FORM N-1A

EVERGREEN EQUITY TRUST

CROSS REFERENCE SHEET

N-1A ITEM NUMBER
- ----------------
PART A CAPTION
------ -------

1. Cover Page Cover Page

2. Synopsis Overview of the Funds;
Expense Information

3. Condensed Financial Information Financial Highlights

4. General Description of Registrant Overview of the Funds;
Description of the Funds;
Investment Instruments
and Practices; Investment
Restrictions; General
Information

5. Management of Fund Overview of the Funds;
Management of the Funds;
General Information;
Expense Information

5A. Management's Discussion of
Fund Performance *

6. Capital Stock and Other Securities Overview of the Funds;
General Information;
Dividends, Distributions
and Taxes; Description of
the Funds; Shareholder
Services

7. Purchase of Securities Purchase and Redemption
Being Offered of Shares

8. Redemption or Repurchase Purchase and Redemption
of Shares

9. Pending Legal Proceedings *

10. Cover Page Cover Page

2
<PAGE>

N-1A ITEM NUMBER
- ----------------
PART A CAPTION
------ -------

11. Table of Contents Table of Contents

12. General Information and History *

13. Investment Objectives and Policies Investment Objectives and
Policies; Investment
Restrictions; Certain
Risk Considerations

14. Management of the Fund Management; Trustees
Compensation Table;
Investment Advisor

15. Control Persons and Principal Trustees Compensation
Holders of Securities Table; General
Information About the
Funds

16. Investment Advisory and Investment Advisor;
Other Services Distribution Plans

17. Brokerage Allocation and Allocation of Brokerage
Other Practices

18. Capital Stock and Other Securities *

19. Purchase, Redemption and Pricing Net Asset Value;
of Securities Being Offered Purchase of Shares

20. Tax Status Additional Tax
Information

21. Underwriters Distribution Plans;
General Information About
the Funds

22. Calculation of Performance Data Performance Information

23. Financial Statements Financial Statements

- --------------------------------------------------------------------------------
* Omitted because answer is negative or inapplicable.

3
<PAGE>

Certain of the information contained herein is contingent upon (i) the
requisite approval of the shareholders of the Evergreen U.S. Real Estate Equity
Fund and Evergreen Global Real Estate Equity Fund (the "Funds"), each a series
of the Registrant, and (ii) the completion of the sale of certain assets from
Evergreen Asset Management Corp., the current investment adviser to the Funds,
to Alpine Management and Research, LLC, the proposed new investment adviser to
the Funds.

4
<PAGE>
PROSPECTUS FEBRUARY , 1998

ALPINE U.S. REAL ESTATE EQUITY FUND
ALPINE INTERNATIONAL REAL ESTATE EQUITY FUND
SERIES OF ALPINE EQUITY TRUST

CLASS A SHARES
CLASS B SHARES
CLASS C SHARES

------------------

Alpine U.S. Real Estate Equity Fund and Alpine International Real Estate
Equity Fund (the "Funds") are mutual funds which seek long-term capital growth.
A secondary objective of each Fund is current income. The Funds are diversified
series of Alpine Equity Trust (the "Trust"), which is a registered open-end,
management investment company.

Alpine Management & Research, LLC serves as the investment adviser of the
Funds.

This Prospectus contains important information regarding the Funds and sets
forth concise information about the Funds that a prospective investor in Class
A, Class B and Class C Shares should know before investing. The address of the
Funds is 2500 Westchester Avenue, Purchase, New York 10577.

A Statement of Additional Information for the Funds dated February , 1998
has been filed with the Securities and Exchange Commission and is incorporated
by reference herein. The Statement of Additional Information provides more
detailed information regarding certain matters discussed in this Prospectus and
other matters which may be of interest to investors, and may be obtained without
charge by calling (800) 343-2898. There can be no assurance that the investment
objectives of the Funds will be achieved. Investors are advised to read this
Prospectus carefully and to retain it for future reference.

------------------------

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

<TABLE>
<CAPTION>
PAGE
-----
<S> <C>
OVERVIEW OF THE FUNDS...................................................................................... 3

EXPENSE INFORMATION........................................................................................ 3

FINANCIAL HIGHLIGHTS....................................................................................... 5

DESCRIPTION OF THE FUNDS................................................................................... 11

INVESTMENT INSTRUMENTS AND PRACTICES....................................................................... 13

DERIVATIVE INVESTMENTS..................................................................................... 19

INVESTMENT RESTRICTIONS.................................................................................... 21

RISK CONSIDERATIONS........................................................................................ 21

MANAGEMENT OF THE FUNDS.................................................................................... 22

DISTRIBUTION PLANS AND AGREEMENTS.......................................................................... 23

PURCHASE AND REDEMPTION OF SHARES.......................................................................... 24

EXCHANGE PRIVILEGE......................................................................................... 28

SHAREHOLDER SERVICES....................................................................................... 29

DIVIDENDS, DISTRIBUTIONS AND TAXES......................................................................... 30

GENERAL INFORMATION........................................................................................ 31
</TABLE>

2
<PAGE>
OVERVIEW OF THE FUNDS

The following summary is qualified in its entirety by the more detailed
information contained elsewhere in this Prospectus. See "DESCRIPTION OF THE
FUNDS" and "MANAGEMENT OF THE FUNDS".

The investment adviser of the Funds is Alpine Management & Research, LLC
(the "Adviser"). The Adviser is a newly formed Delaware limited liability
company which was formed for the purpose of providing investment advisory and
management services to investment companies and advisory clients.

ALPINE U.S. REAL ESTATE EQUITY FUND seeks long-term capital growth. Current
income is a secondary objective. The Alpine U.S. Real Estate Equity Fund invests
primarily in equity securities of United States issuers which are principally
engaged in the real estate industry or which own significant real estate assets.

ALPINE INTERNATIONAL REAL ESTATE EQUITY FUND seeks long-term capital growth.
Current income is a secondary objective. The Alpine International Real Estate
Equity Fund invests primarily in equity securities of non-United States issuers
which are principally engaged in the real estate industry or which own
significant real estate assets.

EXPENSE INFORMATION

The tables set forth below summarize the shareholder transaction costs
associated with an investment in Class A, Class B and Class C Shares of each of
the Funds, together with examples of the cumulative effect of such expenses on a
hypothetical $1,000 investment for the periods specified, assuming: (i) a 5%
annual return and (ii) redemption at the end of each period. For further
information see "PURCHASE AND REDEMPTION OF SHARES" and "GENERAL
INFORMATION--Other Classes of Shares".

<TABLE>
<CAPTION>
CLASS A CLASS B CLASS C
----------- ----------- -----------
<S> <C> <C> <C>
Maximum Sales Charge Imposed on Purchases (as a % of offering
price)......................................................... 4.75%(1) None None
Sales Charge on Dividend Reinvestments........................... None None None
Contingent Deferred Sales Charge (as a % of original purchase
price or redemption proceeds, whichever is lower).............. None 5.00%(2)(3) 1.00%(2)
Redemption Fee................................................... None None None
</TABLE>

- ------------------------

(1) The Fund does not charge a front-end sales charge on purchases of $1 million
or more, but it does charge a contingent deferred sales charge of 1.00% if
you redeem those shares within one year after your purchase.

(2) The deferred sales charge on Class B shares declines from 5.00% to 1.00% of
amounts redeemed within six years after the month of purchase. The deferred
sales charge on Class C shares is 1.00% on amounts redeemed within one year
after the month of purchase. The fund does not charge a contingent deferred
sales charge on redemptions made after that time. See "PURCHASE AND
REDEMPTION OF SHARES" for more information.

(3) Long-term shareholders may pay more than the economic equivalent front-end
sales charges permitted by the National Association of Securities Dealers,
Inc. See "PURCHASE AND REDEMPTION OF SHARES" for more information.

3
<PAGE>
ALPINE U.S. REAL ESTATE EQUITY FUND

<TABLE>
<CAPTION>
ANNUAL OPERATING EXPENSES
(AFTER REIMBURSEMENTS)
-------------------------------------
CLASS A CLASS B CLASS C
----------- ----------- -----------
<S> <C> <C> <C>
Management Fees...................................................................... 1.00% 1.00% 1.00%
12b-1 Fees(1)........................................................................ 0.75% 1.00% 1.00%
Other Expenses....................................................................... (--%) (--%) (--%)
--- --- ---
Total................................................................................ (--%) (--%) (--%)
--- --- ---
--- --- ---
</TABLE>

<TABLE>
<CAPTION>
EXAMPLES
---------------------------------------------------------------
ASSUMING REDEMPTION ASSUMING NO REDEMPTION
AT END OF PERIOD
------------------------------------- ------------------------
CLASS A CLASS B CLASS C CLASS B CLASS C
----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
After 1 Year...................................................... $ (--) $ (--) $ (--) $ (--) $ (--)
After 3 Years..................................................... $ (--) $ (--) $ (--) $ (--) $ (--)
After 5 Years..................................................... $ (--) $ (--) $ (--) $ (--) $ (--)
After 10 Years.................................................... $ (--) $ (--) $ (--) $ (--) $ (--)
</TABLE>

- ------------------------

(1) For Class B and C shares, a portion of the 12b-1 fees equivalent to 0.25% of
average annual assets will be shareholder servicing-related.
Distribution-related 12b-1 fees will be limited to 0.75% of average annual
assets as permitted under the rules of the National Association of
Securities Dealers, Inc. ("NASD").

ALPINE INTERNATIONAL REAL ESTATE EQUITY FUND

<TABLE>
<CAPTION>
ANNUAL OPERATING EXPENSES(1)
(AFTER REIMBURSEMENTS)
-------------------------------------
CLASS A CLASS B CLASS C
----------- ----------- -----------
<S> <C> <C> <C>
Management Fees...................................................................... 1.00% 1.00% 1.00%
12b-1 Fees(1)........................................................................ 0.75% 1.00% 1.00%
Other Expenses....................................................................... (-- ) (-- ) (-- )
--- --- ---
Total................................................................................ (-- ) (-- ) (-- )
--- --- ---
--- --- ---
</TABLE>

<TABLE>
<CAPTION>
EXAMPLES
---------------------------------------------------------------
ASSUMING REDEMPTION ASSUMING NO REDEMPTION
AT END OF PERIOD
------------------------------------- ------------------------
CLASS A CLASS B CLASS C CLASS B CLASS C
----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
After 1 Year...................................................... $ (--) $ (--) $ (--) $ (--) $ (--)
After 3 Years..................................................... $ (--) $ (--) $ (--) $ (--) $ (--)
After 5 Years..................................................... $ 155 $ 169 $ 149 $ 149 $ 149
After 10 Years.................................................... $ 279 $ 289 $ 316 $ 289 $ 316
</TABLE>

The purpose of the foregoing tables is to assist an investor in
understanding the various costs and expenses that an investor in the Class A,
Class B and Class C Shares of the Funds will bear directly or indirectly. The
amounts set forth both in the tables and in the examples are estimated amounts
based on the operating expenses of each Fund for the most recent fiscal period
without giving effect to any fee waivers or expense reimbursements that were in
effect during that period. THE EXAMPLES SHOULD NOT BE CONSIDERED A
REPRESENTATION OF PAST OR FUTURE EXPENSES OR ANNUAL RETURN. ACTUAL EXPENSES AND
ANNUAL RETURN MAY BE GREATER OR LESS THAN THOSE SHOWN. For a more complete
description of the various costs and expenses borne by the Funds

4
<PAGE>
see "MANAGEMENT OF THE FUNDS". As a result of asset-based sales charges,
long-term shareholders may pay more than the economic equivalent of the maximum
front-end sales charges permitted under the rules of the National Association of
Securities Dealers, Inc.

FINANCIAL HIGHLIGHTS

The tables on the following pages present, for each Fund, financial
highlights for a share outstanding throughout each period indicated. The
information in the tables for the five most recent fiscal years for the Funds
has been audited by Price Waterhouse LLP, the Funds' independent auditors. A
report of Price Waterhouse LLP, on the audited information with respect to each
Fund is incorporated by reference in the Funds' Statement of Additional
Information. The following information for each Fund should be read in
conjunction with the financial statements and related notes which are
incorporated by reference in the Funds' Statement of Additional Information.

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

ALPINE U.S. REAL ESTATE EQUITY FUND

<TABLE>
<CAPTION>
CLASS A SHARES
------------------------------
YEAR ENDED SEPTEMBER 30,
------------------------------
1997** 1996** 1995*
--------- -------- -------
<S> <C> <C> <C>
PER SHARE DATA:
Net asset value beginning of year.................................................... $ 12.49 $ 11.42 $ 9.21
--------- -------- -------
Income from investment operations
Net investment income................................................................ 0.12# 0.20 0.18
Net realized and unrealized gain on investments...................................... 8.57 1.28 2.03
--------- -------- -------
Total from investment operations................................................... 8.69 1.48 2.21
--------- -------- -------
Less distributions from
Net investment income................................................................ (0.26)# (0.20) 0
Net realized gain on investments..................................................... (1.58) (0.21) 0
--------- -------- -------
Total distributions................................................................ (1.84) (0.41) 0
--------- -------- -------
Net asset value end of year........................................................ $ 19.34 $ 12.49 $ 11.42
--------- -------- -------
--------- -------- -------
TOTAL RETURN+........................................................................ 78.28% 13.12% 24.00%
RATIOS/SUPPLEMENTAL DATA
Net assets end of year (thousands)................................................... $ 2,778 $ 263 $ 5
Ratios to average net assets:
Total expenses..................................................................... 1.77% 1.72% 1.78%++
Interest expense................................................................... N/A 0.04% N/A
Total expenses, excluding indirectly paid expenses................................. 1.76% N/A N/A
Total expenses, excluding fee waivers & expense reimbursements..................... 2.49% 9.65% 364.74%++
Net investment income.............................................................. 0.90% 1.60% 3.13%++
Portfolio turnover rate.............................................................. 205% 169% 115%
Average commission rate paid per share............................................... $ 0.0597 $ 0.0619 N/A
</TABLE>

- ------------------------

** Calculated based on average shares outstanding throughout the period.

* For the period from March 10, 1995 (commencement of class operations) to
September 30, 1995.

+ Initial sales charge or contingent deferred sales charge is not reflected.

++ Annualized.

# The per share amount of net investment income is not in accordance with the
distributions per share from net investment income due to the timing of
sales of Fund shares after the Fund declared its

5
<PAGE>
annual income distribution on December 26, 1996. Further, the distributions
declared on such date were paid principally from net Investment income
earned during the previous fiscal year.

6
<PAGE>

<TABLE>
<CAPTION>
CLASS B SHARES
-----------------------------
YEAR ENDED SEPTEMBER 30,
-----------------------------
1997** 1996** 1995*
--------- -------- ------
<S> <C> <C> <C>
PER SHARE DATA:
Net asset value beginning of year..................................................... $ 12.41 $ 11.37 $ 9.19
--------- -------- ------
Income from investment operations
Net investment income................................................................. 0.02# 0.13 0.05
Net realized and unrealized gain on investments....................................... 8.49 1.27 2.13
--------- -------- ------
Total from investment operations.................................................... 8.51 1.40 2.13
--------- -------- ------
Less distributions from
Net investment income................................................................. (0.20)# (0.15) 0
Net realized gain on investments...................................................... (1.58) (0.21) 0
--------- -------- ------
Total distributions................................................................. (1.78) (0.36) 0
--------- -------- ------
Net asset value end of year......................................................... $ 19.14 $ 12.41 $11.37
--------- -------- ------
--------- -------- ------
TOTAL RETURN+......................................................................... 76.87% 12.49% 23.72%
RATIOS/SUPPLEMENTAL DATA
Net assets end of year (thousands).................................................... $ 3,446 $ 431 $ 160
Ratios to average net assets:
Total expenses...................................................................... 2.52% 2.46% 2.51%++
Interest expense.................................................................... N/A 0.04% N/A
Total expenses, excluding indirectly paid expenses.................................. 2.51% N/A N/A
Total expenses, excluding fee waivers & expense reimbursements...................... 3.24% 6.19% 28.70%++
Net investment income............................................................... 0.12% 1.05% 2.00%++
Portfolio turnover rate............................................................... 205% 169% 115%
Average commission rate paid per share................................................ $ 0.0597 $ 0.0619 N/A
</TABLE>

- ------------------------

** Calculated based on average shares outstanding throughout the period.

* For the period from March 7, 1995 (commencement of class operations) to
September 30, 1995.

+ Initial sales charge or contingent deferred sales charge is not reflected.

++ Annualized.

# The per share amount of net investment income is not in accord with the
distributions per share from net investment income due to the timing of
sales of Fund shares after the Fund declared its annual income distribution
on December 26, 1996. The distributions declared on such date were paid
principally from net investment income earned during the previous fiscal
year.

7
<PAGE>

<TABLE>
<CAPTION>
CLASS C SHARES
------------------------------
YEAR ENDED SEPTEMBER 30,
------------------------------
1997** 1996** 1995*
--------- -------- -------
<S> <C> <C> <C>
PER SHARE DATA:
Net asset value beginning of year.................................................... $ 12.44 $ 11.41 $ 10.87
--------- -------- -------
Income from investment operations
Net investment income................................................................ 0.03# 0.13 0.08
Net realized and unrealized gain on investments...................................... 8.47 1.28 0.46
--------- -------- -------
Total from investment operations................................................... 8.50 1.41 0.54
--------- -------- -------
Less distributions from
Net investment income................................................................ (0.23)# (0.17) 0
Net realized gain on investments..................................................... (1.58) (0.21) 0
--------- -------- -------
Total distributions................................................................ (1.81) (0.38) 0
--------- -------- -------
Net asset value end of year........................................................ $ 19.13 $ 12.44 $ 11.41
--------- -------- -------
--------- -------- -------
TOTAL RETURN+........................................................................ 76.89% 12.49% 4.97%
RATIOS/SUPPLEMENTAL DATA
Net assets end of year (thousands)................................................... $ 1,673 $ 125 $ 3
Ratios to average net assets:
Total expenses..................................................................... 2.52% 2.47% 2.49%++
Interest expense................................................................... N/A 0.04% N/A
Total expenses, excluding indirectly paid expenses................................. 2.51% N/A N/A
Total expenses, excluding fee waivers & expense reimbursements..................... 3.24% 18.82% 421.54%++
Net investment income.............................................................. 0.23% 1.08% 2.55%++
Portfolio turnover rate.............................................................. 205% 169% 115%
Average commission rate paid per share............................................... $ 0.0597 $ 0.0619 N/A
</TABLE>

- ------------------------

** Calculated based on average shares outstanding throughout the period.

* For the period from July 12, 1995 (commencement of class operations) to
September 30, 1995.

+ Initial sales charge or contingent deferred sales charge is not reflected.

++ Annualized.

# The per share amount of net investment income is not in accord with the
distributions per share from net investment income due to the timing of
sales of Fund shares after the Fund declared its annual Income distribution
on December 26, 1996. The distributions declared on such date were paid
principally from net investment income earned during the previous fiscal
year.

8
<PAGE>
ALPINE INTERNATIONAL REAL ESTATE EQUITY FUND

<TABLE>
<CAPTION>
CLASS A SHARES
------------------------------------------------
YEAR ENDED OCTOBER 31, YEAR ENDED
----------------------------- SEPTEMBER 30,
1997 1996 1995# 1995*
-------- ------- -------- -------------
<S> <C> <C> <C> <C>
PER SHARE DATA:
Net asset value beginning of year................................ $ 12.28 $ 11.58 $ 12.12 $ 11.46
-------- ------- -------- -------------
Income (loss) from investment operations:**
Net investment income (loss)................................... (0.06) .06 (.01) .07
Net realized and unrealized gain (loss) on investments and
foreign currency related transactions........................ 0.72 0.64 (0.53) 0.59
-------- ------- -------- -------------
Total from investment operations............................... 0.66 0.70 (0.54) 0.66
-------- ------- -------- -------------
Net asset value, end of year..................................... $ 12.94 $ 12.28 $ 11.58 $ 12.12
-------- ------- -------- -------------
-------- ------- -------- -------------
Total Return+.................................................... 5.4% 6.0% (4.5%) 5.8%
-------- ------- -------- -------------
-------- ------- -------- -------------
Ratios & Supplemental Data:
Net assets end of year (thousands)............................... $ 336 $ 721 $ 74 $ 66
Ratios to average net assets:
Expenses....................................................... 2.10% 1.79% 1.73%++ 1.61%++
Interest expense............................................... 0.03% 0.03% 0.03%++ 0.01%++
Expenses, excluding indirectly paid expenses................... 2.10% N/A N/A N/A
Expenses, excluding fee waivers & expense reimbursements....... 2.19% 2.97% 46.90%++ 21.59%++
Net investment income (loss)................................... (0.47%) 0.40% (1.26%)++ 0.98%++
Portfolio turnover rate.......................................... 44% 25% 1% 28%
Average commission rate per share................................ $ .0039 $ .0037 N/A N/A
</TABLE>

<TABLE>
<CAPTION>
CLASS B SHARES
------------------------------------------------
YEAR ENDED OCTOBER 31, YEAR ENDED
----------------------------- SEPTEMBER 30,
1997 1996 1995# 1995*
-------- ------- -------- -------------
<S> <C> <C> <C> <C>
PER SHARE DATA:
Net asset value beginning of year $ 12.14 $ 11.53 $ 12.08 $ 11.43
-------- ------- -------- -------------
Income (loss) from investment operations:**
Net investment income (loss)................................... (0.15) (0.13) (0.02) .08
Net realized and unrealized gain (loss) on investments and
foreign currency related transactions........................ 0.70 0.74 (0.53) 0.56
-------- ------- -------- -------------
Total from investment operations............................... 0.55 0.61 (0.55) 0.64
-------- ------- -------- -------------
Net asset value, end of year..................................... $ 12.69 $ 12.14 $ 11.53 $ 12.08
-------- ------- -------- -------------
-------- ------- -------- -------------
Total Return+.................................................... 4.5% 5.3% (4.6%) 5.6%
-------- ------- -------- -------------
-------- ------- -------- -------------
Ratios & Supplemental Data:
Net assets end of year (thousands)............................... $ 213 $ 134 $ 100 $ 128
Ratios to average net assets:
Expenses....................................................... 2.82% 2.56% 2.44%++ 2.42%++
Interest expense............................................... 0.03% 0.03% 0.03%++ 0.03%++
Expenses, excluding indirectly paid expenses................... 2.81% N/A N/A N/A
Expenses, excluding fee waivers & expense reimbursements....... 2.90% 14.45% 31.39% 82.74%
Net investment income (loss)................................... (1.23%) (1.03%) (1.98%)++ 1.38%++
</TABLE>

9
<PAGE>
<TABLE>
<CAPTION>
CLASS B SHARES
------------------------------------------------
YEAR ENDED OCTOBER 31, YEAR ENDED
----------------------------- SEPTEMBER 30,
1997 1996 1995# 1995*
-------- ------- -------- -------------
Portfolio turnover rate.......................................... 44% 25% 1% 28%
<S> <C> <C> <C> <C>
Average commission rate per share................................ $ .0039 $ .0037 N/A N/A
</TABLE>

- ------------------------

* For the periods from February 10, 1995 for Class A and February 8, 1995 for
Class B, respectively (commencement of operations) to September 30, 1995.

** Net investment income is based on average monthly shares outstanding.

# The Fund changed its year end from September 30 to October 31, effective
October 31, 1995.

+ Initial sales charge or contingent deferred sales charge is not reflected.

++ Annualized.

<TABLE>
<CAPTION>
CLASS C SHARES
------------------------------------------------
YEAR ENDED OCTOBER 31, YEAR ENDED
----------------------------- SEPTEMBER 30,
1997 1996 1995# 1995*
-------- ------- -------- -------------
<S> <C> <C> <C> <C>
PER SHARE DATA:
Net asset value beginning of year................................ $ 12.14 $ 11.53 $ 12.08 $ 11.44
-------- ------- -------- -------------
Income (loss) from investment operations:**
Net investment income (loss)................................... (0.14) (0.13) (0.02) .06
Net realized and unrealized gain (loss) on investments and
foreign currency related transactions........................ 0.70 0.74 (0.53) 0.59
-------- ------- -------- -------------
Total from investment operations............................... 0.56 0.61 (0.55) 0.65
-------- ------- -------- -------------
Net asset value, end of year..................................... $ 12.70 $ 12.14 $ 11.53 $ 12.08
-------- ------- -------- -------------
-------- ------- -------- -------------
Total Return+.................................................... 4.6% 5.3% (4.6%) 5.7%
-------- ------- -------- -------------
-------- ------- -------- -------------
Ratios & Supplemental Data:
Net assets end of year (thousands)............................... $ 106 $ 8 $ 4 $ 7
Ratios to average net assets:
Expenses....................................................... 2.83% 2.54% 2.37%++ 1.54%++
Interest expense............................................... 0.03% 0.03% 0.02%++ 0.01%++
Expenses, excluding indirectly paid expenses................... 2.83% N/A N/A N/A
Expenses, excluding fee waivers & expense reimbursements....... 2.91% 118.64% 570.26%++ 269.60%++
Net investment income (loss)................................... (1.15%) (1.06%) (1.94%)++ 0.86%++
Portfolio turnover rate.......................................... 44% 25% 1% 28%
Average commission rate per share................................ .0039 .0037 N/A N/A
</TABLE>

- ------------------------

* For the period from February 9, 1995 (commencement of operations) to
September 30, 1995.

** Net investment income is based on average monthly shares outstanding.

# The Fund changed its year end from September 30 to October 31, effective
October 31, 1995.

+ Initial sales charge or contingent deferred sales charge is not reflected.

++ Annualized.

10
<PAGE>
DESCRIPTION OF THE FUNDS

INVESTMENT OBJECTIVES AND POLICIES

Unless otherwise noted in this Prospectus, the Funds' investment policies
are not fundamental and may be changed without shareholder approval. Each Fund's
investment objective may not be changed without shareholder approval.

In addition to the investment policies detailed below, each Fund may employ
certain additional investment strategies which are discussed in "INVESTMENT
INSTRUMENTS AND PRACTICES" below. The Funds have also adopted a number of
investment restrictions which are set forth in the Statement of Additional
Information.

The Funds may use certain derivative instruments in connection with their
investment activities, engage in short sales and borrow money for investment
purposes. These may be considered speculative practices and may also result in
losses to the Funds.

ALPINE U.S. REAL ESTATE EQUITY FUND

ALPINE U.S. REAL ESTATE EQUITY FUND seeks its investment objective of
long-term capital growth by investing primarily in equity securities of U.S.
issuers which are principally engaged in the real estate industry or which own
significant real estate assets. Current income is a secondary objective. Equity
securities include common stock, preferred stock and securities convertible into
common stock, such as warrants, rights and options.

Under normal market conditions, the Fund invests at least 65% of its total
assets in equity securities of U.S. issuers which are principally engaged in the
real estate industry or which own significant real estate assets. Real estate
industry companies may include among others: equity real estate investment
trusts, which pool investors' funds for investment primarily in commercial real
estate properties; mortgage real estate investment trusts, which invest pooled
funds in real estate related loans; real estate brokers and developers; and
companies with substantial real estate holdings, such as paper and lumber
producers and hotel and entertainment companies. The Fund may invest in real
estate equity trusts and limited partnerships which are traded on major
exchanges or which are not publicly traded. See "RISK CONSIDERATIONS".

The Fund may also invest in debt securities, equity securities of companies
that are unrelated to the real estate industry and money market instruments. In
addition, the Fund may purchase and sell various types of options, financial
futures and currency contracts to manage risk. See "DERIVATIVE INVESTMENTS". The
Fund may invest without limitation in high quality fixed income securities and
money market instruments if, in the opinion of the Fund's investment adviser,
market conditions warrant a temporary defensive investment position

In pursuing its investment objective, the Fund may use various investment
techniques. These may include the use to a limited extent of short sales and the
borrowing of money for investment purposes (which is a practice known as
"leverage"). Short sales and leverage involve certain risks and may be
considered speculative practices. See "INVESTMENT INSTRUMENTS AND
PRACTICES--Short Sales and --Borrowing".

The Fund will concentrate its investments in the securities of companies
engaged principally in the real estate industry and may invest all of its assets
in such securities. However, the Fund may temporarily invest less than 25% of
the value of its assets in such securities during periods of adverse economic
conditions in the real estate industry.

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ALPINE INTERNATIONAL REAL ESTATE EQUITY FUND

ALPINE INTERNATIONAL REAL ESTATE EQUITY FUND seeks its investment objective
of long-term capital growth by investing primarily in equity securities of
non-U.S. issuers which are principally engaged in the real estate industry or
which own significant real estate assets. Current income is a secondary
objective. Equity securities include common stock, preferred stock and
securities convertible into common stock, such as warrants, rights and options.

Under normal market conditions, the Fund invests at least 65% of its total
assets in equity securities of non-U.S. issuers located in at least three
countries outside of the United States which are principally engaged in the real
estate industry or which own significant real estate assets. Real estate
industry companies may include among others: equity real estate investment
trusts, which pool investors' funds for investment primarily in commercial real
estate properties; mortgage real estate investment trusts, which invest pooled
funds in real estate related loans; real estate brokers and developers; and
companies with substantial real estate holdings, such as paper and lumber
producers and hotel and entertainment companies. The Fund may invest in real
estate equity trusts and limited partnerships which are traded on major
exchanges or which are not publicly traded. See "RISK CONSIDERATIONS".

The Fund pursues a flexible strategy of investing in companies throughout
the world. However, it is anticipated that the Fund will give particular
consideration to investments in the United Kingdom, Western Europe, Australia,
Canada, and the Far East (Japan, Hong Kong, Singapore, Malaysia and Thailand).
Generally, a substantial portion of the Fund's investments will be denominated
in foreign currencies. Investments in foreign securities involve certain risks.
See "RISK CONSIDERATIONS".

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INVESTMENT INSTRUMENTS AND PRACTICES

The Funds may use a variety of investment instruments and practices in
pursuing their investment programs. Descriptions of these instruments and
practices, and the risks associated with them, are set forth below.

Investors should consider the Funds as a supplement to an overall investment
program and should invest only if they are willing to undertake the risks
involved. Changes in the value of the Funds' investments will result in changes
in the value of the Funds' shares, and thus the Funds' total return to
shareholders. The risks associated with the Funds' use of derivatives should
also be considered. See "DERIVATIVE INVESTMENTS".

EQUITY SECURITIES

Investments in equity securities may include investments in common stocks,
preferred stocks and securities convertible into common stocks, such as
warrants, rights and options. The value of equity securities varies in response
to many factors, including, but not limited to, the activities and financial
condition of individual companies, the business market in which individual
companies compete and general market and economic conditions. Equity securities
fluctuate in value, often based on factors unrelated to the value of the issuer
of the securities, and such fluctuations can be significant.

SMALLER COMPANIES

The Funds may invest in the securities of issuers having smaller market
capitalizations than the issuers in which many other investment companies
invest. The investment risks associated with securities of smaller companies are
generally greater than those associated with the securities of larger,
well-established companies. Smaller companies often are of more recent formation
than other companies and may have limited product lines, distribution channels
and financial and managerial resources. Further, there is often less publicly
available information concerning smaller companies than there is for larger,
more established issuers. The equity securities of smaller companies are often
traded over-the-counter and those securities may not be traded in the volume
typical for securities that are traded on a national securities exchange.
Consequently, the Funds may be required to dispose of such securities over a
longer period of time (and potentially at less favorable prices) than would be
the case for securities of larger companies. In addition, the prices of the
securities of smaller companies may be more volatile than those of larger
companies.

FIXED INCOME SECURITIES

The Funds may invest in bonds and other types of debt obligations of U.S.
and foreign issuers. Each Fund may invest in these fixed income securities to
earn income or to seek capital growth. Fixed income securities purchased by the
Funds may include, among others: bonds, notes and debentures issued by
corporations; debt securities issued or guaranteed by the U.S. Government or one
of its agencies or instrumentalities ("U.S. Government Securities"); municipal
securities; mortgage-backed and asset-backed securities; debt securities issued
or guaranteed by foreign corporations and foreign governments, their agencies,
instrumentalities or political subdivisions, or by government owned, controlled
or sponsored entities, including central banks. These securities may pay fixed,
variable or floating rates of interest, and may include zero coupon obligations.
Fixed income securities are subject to the risk of the issuer's inability to
meet principal and interest payments on its obligations (i.e., credit risk) and
are subject to price volatility due to such factors as interest rate
sensitivity, market perception of the creditworthiness of the issuer and general
market liquidity (i.e., market risk). There are no restrictions as to the
maximum maturities of the fixed income securities in which the Funds may invest.
Securities having longer maturities generally involve greater risk of
fluctuations in value resulting from changes in interest rates.

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Group, a division of the McGraw-Hill Companies, Inc. ("S&P") or Moody's
Investors Service, Inc. ("Moody's") in one of the four highest rating categories
or, if not rated, have been determined by the Adviser to be of comparable
quality to such rated securities. Non-investment grade debt securities
(typically called "junk bonds") are securities that have received a rating from
S&P or Moody's of below investment grade or that have been given no rating and
are of comparable quality to such rated securities. Lower grade securities are
considered to be predominantly speculative with respect to the issuer's capacity
to pay interest and repay principal. Non-investment grade debt securities in the
lowest rating categories may involve a substantial risk of default. Changes in
economic conditions or developments regarding the individual issuer are more
likely to cause price volatility and weaken the capacity of the issuers of non-
investment grade debt securities to make principal and interest payments than is
the case for higher grade debt securities. An economic downturn affecting an
issuer of non-investment grade debt securities may result in an increased
incidence of default. In addition, the market for lower grade debt securities
may be thinner and less active than for higher grade debt securities. For these
reasons, neither Fund will invest more than 15% of the value of its total assets
in fixed income securities which are not of investment grade.

The Funds will not purchase any debt security rated below CCC by S&P or Caa
by Moody's (or any unrated debt security determined to be of comparable quality
by the Adviser). If the rating of any debt security held by the Funds is
downgraded below such minimum ratings (or if the Adviser determines that a
comparable unrated debt security has similarly declined in quality), there is no
requirement that the Funds sell such security. The determination of whether to
sell any such security will be made by the Adviser, consistent with its best
investment judgment.

FOREIGN SECURITIES

Alpine International Real Estate Equity Fund invests primarily in equity
securities of non-U.S. issuers. Although Alpine U.S. Real Estate Equity Fund
invests primarily in equity securities of U.S. companies, the Fund is permitted
to invest up to 15% of the value of its total assets in equity and fixed income
securities of foreign issuers. Investments in foreign securities may include
depository receipts (such as American Depository Receipts) that represent
indirect interests in securities of foreign issuers. Investments in foreign
securities involve certain risks. With respect to such securities, there may be
more limited information publicly available concerning the issuer than would be
the case with respect to domestic securities, different accounting standards may
be used by foreign issuers and foreign trading markets may not be as liquid as
U.S. markets. Foreign securities also involve such risks as currency risks,
possible imposition of withholding or confiscatory taxes, possible currency
transfer restrictions, expropriation or other adverse political or economic
developments and the difficulty of enforcing obligations in other countries.
These risks may be greater in emerging markets and in less developed countries.
See "RISK CONSIDERATIONS".

The purchase of securities denominated in foreign currencies will subject
the value of a Fund's investments in those securities to fluctuations due to
changes in foreign exchange rates. To hedge against the effects of changes in
foreign exchange rates, each Fund may enter into forward foreign currency
exchange contracts ("forward contracts"). These contracts represent agreements
to exchange an amount of currency at an agreed upon future date and rate. A Fund
will generally use forward contracts only to "lock in" the price in U.S. dollars
of a foreign security that the Fund plans to purchase or to sell, but in certain
limited cases may use such contracts to hedge against an anticipated substantial
decline in the price of a foreign currency against the U.S. dollar that would
adversely affect the U.S. dollar value of foreign securities held by a Fund.
Forward contracts will not be used in all cases and, in any event, cannot
completely protect the Funds against all changes in the values of foreign
securities resulting from fluctuations in foreign exchange rates. Alpine U.S.
Real Estate Equity Fund will not enter into a forward contract if, as a result,
forward contracts would represent more than 15% of its total assets. The Funds
may also use options on foreign currencies and financial futures to manage
foreign currency exposure, which involves certain risks. See "DERIVATIVE
INVESTMENTS--Options on Foreign Currency".

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EMERGING MARKETS

Foreign securities purchased by the Funds may include the securities of
companies which operate primarily in emerging market countries. The economies of
individual emerging countries may differ favorably or unfavorably from the U.S.
economy in such respects as growth of gross domestic product, rate of inflation,
currency depreciation, capital reinvestment, resource self-sufficiency and
balance of payments position. Further, the economies of developing countries
generally are heavily dependent on international trade and, accordingly, have
been, and may continue to be, adversely affected by trade barriers, exchange
controls, managed adjustments in relative currency values and other
protectionist measures imposed or negotiated by the countries with which they
trade. These economies also have been, and may continue to be, adversely
affected by economic conditions in the countries with which they trade.

Prior governmental approval for foreign investments may be required under
certain circumstances in some emerging countries, and the extent of foreign
investment in certain debt securities and domestic companies may be subject to
limitation in other emerging countries. Foreign ownership limitations also may
be imposed by the charters of individual companies in emerging countries to
prevent, among other concerns, violation of foreign investment limitations.
Repatriation of investment income, capital and the proceeds of sales by foreign
investors may require governmental registration or approval in some emerging
countries. A Fund could be adversely affected by delays in, or a refusal to
grant, any required governmental registration or approval for such repatriation.
Any investment subject to such repatriation controls will be considered illiquid
if it appears reasonably likely that this process will take more than seven
days.

With respect to any emerging country, there is the possibility of
nationalization, expropriation or confiscatory taxation, political changes,
governmental regulation, social instability or diplomatic developments
(including war) which could affect adversely the economics of such countries or
the value of the Funds' investments in those countries. In addition, it may be
difficult to obtain and enforce a judgment in a court outside of the U.S.

TEMPORARY INVESTMENTS

For defensive purposes, each Fund may temporarily invest all or a
substantial portion of its assets in high quality fixed income securities and
money market instruments, or may temporarily hold cash in such amounts as the
Adviser deems appropriate. Fixed income securities will be deemed to be of high
quality if they are rated "A" or better by S&P or Moody's or, if unrated, are
determined to be of comparable quality by the Adviser. Money market instruments
are high quality, short-term fixed income obligations (which generally have
remaining maturities of one year or less), and may include: U.S. Government
Securities; commercial paper; certificates of deposit and banker's acceptances
issued by domestic branches of United States banks that are members of the
Federal Deposit Insurance Corporation; repurchase agreements for U.S. Government
Securities; short-term obligations of foreign issuers denominated in U.S.
dollars and traded in the U.S.; and repurchase agreements.

Repurchase agreements are agreements under which a Fund purchases securities
from a bank or a securities dealer that agrees to repurchase the securities from
the Fund at a higher price on a designated future date. If the seller under a
repurchase agreement becomes insolvent, the Fund's right to dispose of the
securities may be restricted, or the value of the securities may decline before
the Fund is able to dispose of them. In the event of the commencement of
bankruptcy or insolvency proceedings with respect to the seller of the
securities before the repurchase of the securities under a repurchase agreement
is accomplished, the Fund may encounter delay and incur costs, including a
decline in the value of the securities, before being able to sell the
securities. If the seller defaults, the value of such securities may decline
before the Fund is able to dispose of them. If a Fund enters into a repurchase
agreement that is subject to foreign law and the other party defaults, the Fund
may not enjoy protections comparable to those provided to certain repurchase
agreements under U.S. bankruptcy law, and may suffer delays and

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losses in disposing of the collateral as a result. The Funds have adopted
procedures designed to minimize certain of the risks of loss from repurchase
agreement transactions.

SHORT SALES

Each of the Funds may effect short sales of securities. However, a Fund may
not sell a security short if, as a result of such sale, the current value of
securities sold short by the Fund would exceed 10% of the value of the Fund's
net assets. If the Fund owns or has the right to obtain securities equivalent in
kind and amount to the securities sold short (i.e., a short sale "against the
box"), this limitation is not applicable.

A short sale involves the sale of a security that the Fund does not own in
anticipation of purchasing the same security (or a security exchangeable
therefor) at a later date at a lower price. To make delivery to the buyer, the
Fund must borrow the security, and is obligated to return the security to the
lender which is accomplished by a later purchase of the security by the Fund to
close its short position. When a Fund effects a short sale, it must maintain
collateral in a segregated account consisting of cash or liquid portfolio
securities with a value equal to the current market value of the securities sold
short, which is marked to market daily. A short sale involves the risk that the
security sold short may increase in value before the Fund purchases it, and the
Fund could incur a loss. Theoretically, an unlimited increase in the market
price of the security would result in an unlimited loss to the Fund. The Funds
will incur transaction costs, including interest expense, in connection with
opening, maintaining and closing short sales.

The use of short sales is considered a speculative investment practice. The
limited use of this practice, however, permits the Funds to pursue opportunities
to profit from anticipated declines in the prices of securities which in the
view of the Adviser are overvalued or are likely to be adversely affected by
particular trends or events relating to the issuers of those securities, the
industry sector in which the issuer is engaged or the general markets or
economy.

Each Fund may also effect short sales "against the box" in order to hedge
against market risks when it believes that the price of a security may decline,
causing a decline in the value of a security owned by the Fund, or when the Fund
does not want to sell the security it owns, because, among other reasons, it
wishes to defer recognition of loss for U.S. federal income tax purposes. If a
Fund makes a short sale against the box, it will be required to set aside
securities equivalent in kind and amount to the securities sold short (or
securities convertible or exchangeable into such securities) and will hold such
securities while the short sale is outstanding.

PORTFOLIO TURNOVER AND BROKERAGE

Although the Funds seek long-term capital growth, they may from time to
engage in short-term trading strategies and securities may be sold without
regard to the time they have been held when investment considerations warrant
such action. These policies, together with the ability of the Funds to effect
short sales of securities and to engage in transactions in options and futures,
may have the effect of increasing the annual rate of portfolio turnover of the
Funds. As a result, each Fund's annual portfolio turnover rate may be higher
than the rates of certain other investment companies. However, it is not
expected that the annual portfolio turnover rate of a Fund will exceed 150%. A
high portfolio turnover rate will result in higher brokerage costs to a Fund and
may also result in the realization of greater capital gains which will be
subject to tax, including short-term gains which will be taxable to shareholders
at ordinary tax rates. The portfolio turnover rates of each Fund are set forth
in the tables contained in the section entitled "FINANCIAL HIGHLIGHTS".

WHEN-ISSUED AND DELAYED DELIVERY TRANSACTIONS

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yield considered to be advantageous. Settlement dates may be a month or more
after entering into these transactions, and the market values of the securities
purchased may vary from the purchase prices. Thus, the Funds may pay more or
less than the market value of the securities on the settlement date. A Fund may
dispose of a commitment prior to settlement if the Adviser deems it appropriate
to do so. In addition, the Funds may enter into transactions to sell their
purchase commitments to third parties at current market values and
simultaneously acquire other commitments to purchase similar securities at later
dates. The Funds may realize short-term profits or losses upon the sale of such
commitments. When a Fund enters into a when-issued and delayed delivery
transaction, it will "cover" its position by maintaining in a segregated account
with the Fund's custodian, cash or liquid securities held by the Fund and having
a value (determined daily) equal to or greater than the purchase commitment or
delivery obligation of the Fund.

ILLIQUID SECURITIES

Each Fund may invest up to 15% of the value of its net assets in illiquid
securities and other investments which are not readily marketable. Illiquid
securities include repurchase agreements maturing in more than seven days.
Alpine U.S. Real Estate Equity Fund may only invest up to 10% of its assets in
such repurchase agreements. Restricted securities eligible for resale pursuant
to Rule 144A under the Securities Act of 1933 (the "Securities Act"), which have
been determined to be liquid by the Adviser pursuant to procedures adopted by
the Trustees, will not be considered by the Funds' investment adviser to be
illiquid or not readily marketable and, therefore, are not subject to the 15%
limit. The inability of a Fund to dispose of illiquid or not readily marketable
investments readily or at a reasonable price could impair the Fund's ability to
sell its investment or to raise cash for redemptions or other purposes. The
liquidity of securities purchased by a Fund which are eligible for resale
pursuant to Rule 144A will be monitored by the Adviser on an ongoing basis and
in the event that such a security is deemed to be no longer liquid, appropriate
action will be taken to ensure that the retention of such security does not
result in a Fund having more than 15% of its net assets invested in illiquid
securities and other investments which are not readily marketable.

BORROWING

Each Fund may borrow money from banks and enter into reverse repurchase
agreements in the aggregate amount of up to 10% of the value of its total assets
to increase its holdings of portfolio securities and may borrow money from banks
for temporary extraordinary or emergency purposes (including to facilitate
redemption requests which might otherwise require untimely disposition of
portfolio securities), subject to the overall limitation that the total
borrowings by a Fund (including borrowing through reverse repurchase agreements)
may not exceed 33 1/3% of the value of the Fund's total assets (measured at the
time of borrowing).

The practice of borrowing money for investment purposes, known as
"leverage", permits the Funds to purchase a greater amount of securities than
would otherwise be possible. This will enable each Fund to increase its
investment return if the additional securities purchased increase in value in an
amount exceeding the interest and other costs (such as commitment fees) incurred
in connection with the borrowing. However, if the purchased securities decrease
in value, the Fund will suffer a loss. Thus, if a Fund borrows money, its share
price may be subject to greater fluctuation until the borrowing is paid off. Use
of leverage is, for this reason, considered to be a speculative investment
practice.

Reverse repurchase agreements are a form of borrowing. Under a reverse
repurchase agreement, a Fund agrees to sell portfolio securities to a financial
institution such as a bank or broker-dealer, and to repurchase them at a
mutually agreed upon date and price. At the time a Fund enters into a reverse
repurchase agreement, it will place in a segregated custodian account cash, U.S.
Government Securities or other liquid high-grade debt obligations having a value
at least equal to the repurchase price (including accrued interest) and will
subsequently monitor the account to ensure that such equivalent value is

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maintained. Reverse repurchase agreements involve the risk that the market value
of the securities sold by a Fund may decline below the repurchase price of those
securities.

LENDING OF PORTFOLIO SECURITIES

In order to generate income, the Funds may lend portfolio securities to
brokers, dealers and other financial institutions. The Adviser will monitor the
creditworthiness of such borrowers. Loans of securities by a Fund, if and when
made, may not exceed 30% of the value of the Fund's total assets and must be
collateralized by cash 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
securities loaned, including accrued interest. While such securities are on
loan, the borrower will pay the Fund any income accruing thereon, and the Fund
may invest the cash collateral in portfolio securities, thereby increasing its
return. A Fund has the right to call a loan and obtain the securities loaned at
any time on notice of not more than five business days. A Fund may pay
reasonable fees in connection with such loans.

There is the risk that, when lending portfolio securities, the securities
may not be returned to a Fund on a timely basis and the Fund may, therefore,
lose the opportunity to sell the securities at a desirable price. In addition,
in the event that a borrower of securities files for bankruptcy or becomes
insolvent, disposition of the securities may be delayed pending court action.

CROSS HEDGING

A cross hedge is accomplished by entering into a forward contract or other
arrangement with respect to one foreign currency for the purpose of hedging
against a possible decline in the value of another foreign currency in which
certain of the Fund's portfolio instruments are denominated. The Adviser may
enter into a cross hedge, rather than hedge directly, in instances where (i) the
rates for forward contracts, options, futures contract or options on futures
contracts relating to the currency in which the cross hedge is effected are more
favorable than rates for similar instruments denominated in the currency that is
to be hedged and (ii) there is a high degree of correlation between the two
currencies with respect to their movement against the U.S. dollar. Cross hedges
may be effected using the various instruments the Funds are authorized to
purchase and sell. A cross hedge cannot protect against exchange rate risks
perfectly, and if the Adviser is incorrect in its judgment of future exchange
rate relationships, a Fund could be in a less advantageous position than if such
a hedge had not been established.

SECURITIES OF OTHER INVESTMENT COMPANIES

Each Fund may invest in the securities of other open-end investment
companies that have investment objectives and policies similar to its own. The
Funds may also purchase shares of money market funds that invest in U.S.
Government Securities and repurchase agreements, in lieu of purchasing money
market instruments directly. Any investment by a Fund in the securities of other
investment companies will be subject to the limitations on such investments
contained in the Investment Company Act of 1940 (the "1940 Act"). The Funds, as
investors in another investment company, including a money market fund, will
bear the fees and expenses of that fund, which will be in addition to the fees
and expenses of the Funds.

DIVERSIFICATION

Diversifying a Fund's investment portfolio by limiting the amount of money
invested in any one issuer can reduce the risks of investing. With respect to
75% of its total assets, a Fund may not purchase a security, other than
securities issued or guaranteed by the U.S. government, its agencies or
instrumentalities, if a as a result of such purchase, more than 5% of the value
of the Fund's total assets would be invested in the securities of any one
issuer, or the Fund would own more than 10% of the voting securities of any one
issuer.

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DERIVATIVE INVESTMENTS

The Funds may use certain derivative instruments in connection with their
investment activities. These include options on individual securities, options
on securities indices, options on foreign currency and warrants, and financial
futures contracts and related options (collectively, "Derivatives"). These
instruments derive their performance, at least in part, from the performance of
an underlying asset or index. While Derivatives will be used to pursue profit
opportunities, and also for hedging purposes, the use of Derivatives can
increase the volatility of a Fund's net asset value, can decrease the liquidity
of a Fund's portfolio and make more difficult the pricing of a Fund's portfolio.
Derivatives may entail investment exposures that are greater than their costs
would suggest, meaning that a small investment in Derivatives could have a large
potential positive or negative impact on a Fund's net asset value per share or
investment performance. If a Fund invests in Derivatives at inappropriate times
or judges market conditions incorrectly, such investments may lower the Fund's
return or result in losses. Changes in the liquidity of the secondary markets in
which a Fund's Derivatives may trade could result in significant, rapid and
unpredictable changes in the prices of such Derivatives, which could also cause
losses to the Fund.

OPTIONS ON SECURITIES

Each Fund may purchase call and put options on securities to seek capital
growth or for hedging purposes. The Funds may also write and sell covered call
and put options for hedging purposes. A put option gives the purchaser of the
option the right to sell, and obligates the writer to buy, the underlying
security at a stated exercise price at any time prior to the expiration of the
option. Similarly, a call option gives the purchaser of the option the right to
buy, and obligates the writer to sell, the underlying security at a stated
exercise price at any time prior to the expiration of the option.

A call option written by a Fund is "covered" if the Fund owns the underlying
security or holds related securities (i.e., securities whose price movements
correlate to the price movements of the securities underlying the option) during
the term of the option. By writing a covered call option, a Fund foregoes the
opportunity to realize any appreciation in the market price of the underlying
security above the exercise price and incurs the risk of having to continue to
hold a security that it might otherwise have subsequently determined to sell
based on investment considerations. A put option written by a Fund is "covered"
if the Fund maintains at all times cash or liquid securities having a value
equal to the option exercise price in a segregated account with the Fund's
custodian, or if the Fund has bought and holds a put on the same security (and
on the same amount of securities) where the exercise price of the put held by
the Fund is equal to or greater than the exercise price of the put written by
the Fund. By writing a put option, a Fund is exposed to the risk, during the
term of the option, of a decline in the price of the underlying security which
the Fund would be required to purchase at a higher price.

After a Fund has written an option, it may close out its position by
purchasing an option on the same security with the same exercise price and
expiration date as the option that it has previously written on the security.
The Fund will realize a profit or loss if the amount paid to purchase the option
is less or more, as the case may be, than the amount received from the sale
thereof. To close out a position as a purchaser of an option, the Fund would
ordinarily make a similar "closing sale transaction", which involves liquidating
the Fund's position by selling the option previously purchased, although the
Fund would be entitled to exercise the option should it deem it advantageous to
do so.

Each Fund may also invest in so-called "synthetic" options or other options
and derivative instruments written by broker-dealers, including options on
baskets of specified securities. Synthetic options transactions involve the use
of two financial instruments that, together, have the economic effect of an
options transaction. The risks of synthetic options are generally similar to the
risks of actual options, with the addition of increased market risk, liquidity
risk, counterparty credit risk, legal risk and operations risk. Other derivative
instruments written by broker-dealers which may be utilized by a Fund include
derivative instruments which are both consistent with the Fund's investment
objective and legally permissible for the

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Fund. The risks of such derivative instruments include market risk, liquidity
risk, counterparty credit risk, legal risk and operations risk.

Options transactions may be effected on domestic and foreign securities
exchanges or in the over-the-counter market. Options positions may be of the
American or the European variety. An American style option may be exercised by
the holder at any time after it is purchased until it expires. A European style
option may be exercised only on its expiration date. When options are purchased
over-the-counter, a Fund bears the risk that the counterparty that wrote the
option will be unable or unwilling to perform its obligations under the option
contract. In addition, the Fund may have difficulty closing out its positions in
over-the-counter options, which could result in losses to the Fund.
Over-the-counter option positions and various derivative instruments may be
illiquid and, in such cases are subject to the limitations on the purchase of
illiquid securities by the Funds.

Each Fund may invest up to 10% of the value of its total assets, represented
by the premium paid, in the purchase of call and put options on securities and
securities indices. (Options on securities indices are discussed below.) A Fund
may not write (i.e., sell) covered call and put options on securities and
securities indices with aggregate exercise prices in excess of 15% of the value
of the Fund's assets measured at the time an option is written.

OPTIONS ON SECURITIES INDICES

Each Fund may purchase and may write and sell call and put options on stock
indices (such as the S&P 500 Index) listed on domestic or foreign securities
exchanges or traded in the over-the-counter market for hedging purposes. A stock
index fluctuates with changes in the market values of the stocks included in the
index. The effectiveness of purchasing or writing stock index options to hedge a
Fund's investment positions will depend upon the extent to which price movements
of securities held by the Fund correlate with price movements of the stock index
selected. Because the value of an index option depends upon movements in the
level of the index rather than the price of a particular stock, whether a Fund
will realize a gain or loss from the purchase or writing of options on an index
depends upon movements in the level of stock prices in the stock market
generally or, in the case of certain indexes, in an industry or market segment,
rather than movements in the price of a particular stock. Accordingly,
successful use by the Funds of options on stock indexes will be subject to the
Adviser's ability to predict correctly movements in the direction of the stock
market generally or of a particular industry or market segment. This requires
different skills and techniques than predicting changes in the price of
individual stocks.

A put option on an index may be purchased to hedge against a general decline
in the stock market or in a particular market segment or industry. A call option
on an index may be purchased in an attempt to reduce the risk of missing a
general market advance or an increase in the prices of securities within a
particular market segment or industry.

Put and call options of stock indices written by the Funds must be
"covered". A call option on an index written by a Fund will be covered if the
Fund segregates in a separate account with its custodian cash or liquid
securities with a value equal to its obligations under the option. A put option
written on an index by a Fund will be "covered" if the Fund maintains cash or
liquid securities with a value equal to the exercise price of the option in a
segregated account with its custodian or if the Fund has bought and holds a put
on the same index (and in the same amount) where the exercise price of the put
held is equal to or greater than the exercise price of the put written.

OPTIONS ON FOREIGN CURRENCIES

20
<PAGE>
transactions may also be used to protect against increases in the U.S. dollar
cost of securities to be acquired by the Funds. As with other types of options,
however, writing an option on foreign currency constitutes only a partial hedge,
up to the amount of the premium received, and the Funds could be required to
purchase or sell foreign currencies at disadvantageous exchange rates, thereby
incurring losses. Certain options on foreign currencies are traded on the
over-the-counter market and involve liquidity and credit risks that may not be
present in the case of exchange traded currency options.

FUTURES CONTRACTS

Each Fund may buy and sell financial futures contracts and related options.
A financial futures contract is an agreement between two parties to buy or sell
a specified instrument (such as currency or an index of securities) at a set
price on a future date. An index futures contract is an agreement to take or
make delivery of an amount of cash based on the difference between the value of
the index at the beginning and at the end of the contract period. A futures
contract on a foreign currency is an agreement to buy or sell a specified amount
of a currency for a specified price on a future date. The Funds may use
financial futures contracts and related options for "bona fide hedging"
purposes, as such term is defined in applicable regulations of the Commodity
Futures Trading Commission. Each Fund is also permitted to enter into such
contracts and options for non-hedging purposes, provided that aggregate initial
margin deposits plus premiums paid by the Fund for open futures options
positions, less the amount by which any such positions are "in-the-money", may
not exceed 5% of the Fund's total assets.

The purchase and sale of futures contracts and related options involve
required risks different from those involved with direct investments in
securities and also require different skills from the Adviser in managing the
Funds' investment portfolios of investments. While utilization of futures
contracts and similar instruments may be advantageous to the Funds, if the
Adviser is not successful in employing such instruments in managing the Funds'
investments or in predicting market changes, the Funds' investment performance
will be worse than if the Funds did not make such investments. It is possible
that there will be imperfect correlation, or even no correlation, between price
movements of the investments being hedged and the options or futures used. It is
also possible that a Fund may be unable to purchase or sell a portfolio security
at a time that otherwise would be favorable for it to do so, or that a Fund may
need to sell a portfolio security at a disadvantageous time, due to the need for
the Fund to maintain "cover" or to segregate securities in connection with its
futures transactions, or that a Fund may be unable to close out or liquidate its
hedged position. In addition, a Fund will pay commissions and incur other costs
in connection with transactions in futures, which may increase the expenses of
the Funds.

INVESTMENT RESTRICTIONS

The Funds have adopted various restrictions on their investment practices.
Except as may otherwise be noted, these restrictions may be changed by the Board
of Trustees of the Trust (the "Trustees"). However, each Fund's investment
objective may not be changed without the approval of the holders of a majority
(as defined in the 1940 Act) of the Fund's outstanding voting securities.
Certain of the Funds' investment restrictions are set forth in this Prospectus.
Additional investment restrictions are described in the Statement of Additional
Information under "INVESTMENT RESTRICTIONS".

RISK CONSIDERATIONS

GENERAL. The total return and net asset value of each Fund will fluctuate,
and such fluctuations could be substantial. Each Fund is subject to the risk
that the Adviser's investment selections will cause the Fund to fail to achieve
its investment objective or to underperform the stock market as a whole. Because
each Fund concentrates its investments in the real estate industry, its
portfolio may experience more volatility and be exposed to greater risk than the
portfolios of many other mutual funds. In addition, certain risks are associated
with investments in real estate related companies and investments in foreign
securities.

21
<PAGE>
Risks associated with investment in securities of companies in the real
estate industry include: declines in the value of real estate, risks related to
general and local economic conditions, overbuilding and increased competition,
increases in property taxes and operating expenses, changes in zoning laws,
casualty or condemnation losses, variations in rental income, changes in
neighborhood values, the appeal of properties to tenants and increases in
interest rates. In addition, equity real estate investment trusts may be
affected by changes in the value of the underlying property owned by the trusts,
while mortgage real estate investment trusts may be affected by the quality of
credit extended. Equity and mortgage real estate investment trusts are dependent
upon management skills, may not be diversified and are subject to the risks of
financing projects. Such trusts are also subject to heavy cash flow dependency,
defaults by borrowers, self liquidation and the possibility of failing to
qualify for tax-free pass-through of income under the Internal Revenue Code of
1986, as amended (the "Code") and to maintain exemption from the 1940 Act. In
the event an issuer of debt securities collateralized by real estate defaulted,
it is conceivable that a Fund could end up holding the underlying real estate.
The value of securities of companies in the real estate industry may go through
cycles of relative under-performance and out-performance in comparison to equity
securities markets in general.

Various risks are also associated with certain of the investment practices
of the Funds. In particular, the use of leverage and short sales by the Funds
are speculative practices and may result in losses to the Funds. See "INVESTMENT
INSTRUMENTS AND PRACTICES--Short Sales and --Borrowing". Investments in foreign
securities, illiquid securities and Derivatives also involve various risks. See
"INVESTMENT INSTRUMENTS AND PRACTICES--Foreign Securities and --Illiquid
Securities" and "DERIVATIVE INVESTMENTS".

Prospective investors should consider the risks of a Fund's investment
program in determining whether to invest in the Fund.

MANAGEMENT OF THE FUNDS

The management of each Fund is supervised by the Board of Trustees of the
Trust. Alpine Management & Research, LLC provides investment advisory services
to the Funds pursuant to Investment Advisory Agreements entered into with the
Trust (the "Advisory Agreements").

The Adviser, located at 2500 Westchester Avenue, Purchase, New York 10577,
is a newly formed Delaware limited liability company. It was organized for the
purpose of providing investment advisory and management services to investment
companies (including the Funds) and other advisory clients. The members of the
Adviser are Messrs. Samuel A. Lieber, who is the controlling person of the
Adviser, and Marc R. Halle. The Adviser does not have any officers. Although the
Adviser has no operating history and has not previously served as the investment
adviser of a mutual fund, its members were the individuals associated with the
former investment adviser of the Funds who were primarily responsible for
investment advisory services provided to the Funds.

As investment adviser to Funds, the Adviser manages the Funds' investments
and is responsible for providing the Funds with various administrative services.
As investment adviser to Alpine U.S. Real Estate Equity Fund, the Adviser is
entitled to receive from the Fund a monthly fee computed at the annual rates of
1% of the average daily net assets of the Fund on the first $750 million of
assets, 0.9% of average daily net assets on an annual basis on the next $250
million in assets, and 0.8% of average daily net assets on assets in excess of
$1 billion. As investment adviser to Alpine International Real Estate Equity
Fund, the Adviser is entitled to receive from the Fund a monthly fee computed at
the annual rate of 1% of the average daily net assets of the Fund on an annual
basis. The advisory fees paid by the Funds are higher than those paid by most
other investment companies, but are not higher than the fees paid by many funds
with similar investment objectives and policies. The total expenses of the Funds
as a percentage of average daily net assets are set forth in the section
entitled "FINANCIAL HIGHLIGHTS".

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<PAGE>
The portfolio manager for the Funds is Samuel A. Lieber. Mr. Lieber has been
the principal portfolio manager of the Funds since their inception. Prior to the
organization of the Adviser, he was associated with Evergreen Asset Management
Corp. since 1985.

DISTRIBUTION PLANS AND AGREEMENTS

Rule 12b-1 under the 1940 Act permits an investment company to pay expenses
associated with the distribution of its shares in accordance with a duly adopted
plan. Each Fund has adopted for each of its Class A, Class B and Class C shares
a Rule 12b-1 plan (each, a "Plan" or collectively the "Plans"). Under the Plans,
each Fund may incur distribution-related and shareholder servicing-related
expenses which may not exceed an annual rate of .75 of 1% of the aggregate
average daily net assets attributable to each Fund's Class A shares and 1% of
the aggregate average daily net assets attributable to the Class B and Class C
shares of the Funds. The Plans provide that a portion of the fees payable
thereunder may constitute a service fee to be used for providing ongoing
personal services and/or the maintenance of shareholder accounts.

Each Fund has also entered into a distribution agreement (each a
"Distribution Agreement" or collectively the "Distribution Agreements") with
Evergreen Keystone Distributor, Inc. ("EKD"), which serves as distributor of
shares of the Funds. Pursuant to the Distribution Agreements, and as authorized
by the Plans, each Fund compensates EKD for its services as distributor at a
rate which may not exceed an annual rate of .25 of 1% of a Fund's aggregate
average daily net assets attributable to Class A shares and .75 of 1% of a
Fund's aggregate average daily net assets attributable to the Class B and Class
C shares. The Distribution Agreements provide that EKD will use the distribution
fee received from a Fund for payments (i) to compensate broker-dealers or other
persons for distributing shares of the Funds, including interest and principal
payments made in respect of amounts paid to broker-dealers or other persons that
have been financed (EKD may assign its rights to receive compensation under the
Plans to secure such financings), (ii) to otherwise promote the sale of shares
of the Fund, and (iii) to compensate broker-dealers, depository institutions and
other financial intermediaries for providing administrative, accounting and
other services with respect to the Fund's shareholders. The financing of
payments made by EKD to compensate broker-dealers or other persons for
distributing shares of the Funds may be provided by First Union National Bank,
North Carolina ("FUNB") or its affiliates. The Funds may also make payments
under the Plans, in amounts up to .25 of 1% of a Fund's aggregate average daily
net assets on an annual basis attributable to Class B and Class C shares, to
compensate organizations, which may include EKD and the Funds' investment
adviser or their affiliates, for personal services rendered to shareholders and
the maintenance of shareholder accounts.

The Funds may not pay any distribution or services fees during any fiscal
period in excess of the amounts set forth above. Since EKD's compensation under
the Distribution Agreements is not directly tied to the expenses incurred by
EKD, the amount of compensation received by it under the Distribution Agreements
during any year may be more or less than its actual expenses and may result in a
profit to EKD. Distribution expenses incurred by EKD in one fiscal year that
exceed the level of compensation paid to EKD for that year may be paid from
distribution fees received from a Fund in subsequent fiscal years.

The Plans are in compliance with rules of the National Association of
Securities Dealers, Inc. which effectively limit the annual asset-based sales
charges and service fees that a mutual fund may pay on a class of shares to .75
of 1% and .25 of 1%, respectively, of the average annual net assets attributable
to that class. The rules also limit the aggregate of all front-end, deferred and
asset-based sales charges imposed with respect to a class of shares by a mutual
fund that also charges a service fee to 6.25% of cumulative gross sales of
shares of that class, plus interest at the prime rate plus 1% per annum.

23
<PAGE>
PURCHASE AND REDEMPTION OF SHARES

HOW TO BUY SHARES

You can purchase Class A, Class B and Class C shares of the Funds through
broker-dealers, banks or other financial intermediaries, or directly through
EKD. The minimum initial investment is $1,000, which may be waived in certain
situations. There is no minimum for subsequent investments. Investments of $25
or more are allowed under the Systematic Investment Plan. Share certificates are
not issued. In states where EKD is not registered as a broker-dealer, shares of
a Fund will only be sold through BISYS Fund Services, other broker-dealers or
other financial institutions that are registered. See the Share Purchase
Application and Statement of Additional Information for more information. Only
Class A, Class B and Class C Shares are offered through this Prospectus (See
"GENERAL INFORMATION--Other Classes of Shares"). Shares will be issued at the
net asset value per share next computed after the receipt of a request to
purchase shares, together with payment in the amount of the purchase (plus for
Class A Shares the sales charge).

CLASS A SHARES--FRONT-END SALES CHARGE ALTERNATIVE. You can purchase Class
A shares at net asset value plus an initial sales charge on purchases under
$1,000,000. On purchases of $1,000,000 or more, a contingent deferred sales
charge ("CDSC") equal to 1% of the lesser of the purchase price or redemption
value will be imposed on shares redeemed during the first year after purchase.
The schedule of charges for Class A Shares is as follows:

INITIAL SALES CHARGE

<TABLE>
<CAPTION>
COMMISSION TO
AS A % OF THE NET AS A % OF THE DEALER/AGENT AS A % OF
AMOUNT OF PURCHASE AMOUNT INVESTED OFFERING PRICE OFFERING PRICE
- ----------------------------------------------- ----------------- --------------- -----------------------
<S> <C> <C> <C>
Less than $50,000.............................. 4.99% 4.75% 4.25%
$50,000 - $99,000.............................. 4.71% 4.50% 4.25%
$100,000 - $249,999............................ 2.90% 3.75% 3.25%
$250,000 - $499,999............................ 2.56% 2.50% 2.00%
$500,000 - $999,999............................ 2.04% 2.00% 1.75%
$1,000,000 - $2,999,999........................ None None 1.00%
$3,000,000 - $4,999,999........................ None None .50%
Over $5,000,000................................ None None .25%
</TABLE>

No front-end sales charges are imposed on Class A shares purchased by
institutional investors, which may include bank trust departments and registered
investment advisers; investment advisers, consultants or financial planners who
place trades for their own accounts or the accounts of their clients and who
charge such clients a management, consulting, advisory or other fee; clients of
investment advisers or financial planners who place trades for their own
accounts if the accounts are linked to the master account of such investment
advisers or financial planners on the books of the broker-dealer through whom
shares are purchased; institutional clients of broker-dealers, including
retirement and deferred compensation plans and the trusts used to fund these
plans, which place trades through an omnibus account maintained with a Fund by
the broker-dealer; shareholders of record on October 12, 1990 in any series of
Evergreen Investment Trust in existence on that date, and the members of their
immediate families; current and retired employees of FUNB and its affiliates,
EKD and any broker-dealer with whom EKD has entered into an agreement to sell
shares of the Funds, and members of the immediate families of such employees;
and upon the initial purchase of a Fund by investors reinvesting the proceeds
from a redemption within the preceding thirty days of shares of the other Fund
or the Evergreen mutual funds, provided such shares were initially purchased
with a front-end sales charge or subject to a CDSC. Certain broker-dealers or
other financial institutions may impose a fee in connection with transactions in
shares of the Funds.

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<PAGE>
Class A shares may also be purchased at net asset value by qualified and
non-qualified employee benefit and savings plans which make shares of the Funds
available to their participants, and which: (a) are employee benefit plans
having at least $1,000,000 in investable assets, or 250 or more eligible
participants; or (b) are non-qualified benefit or profit sharing plans which are
sponsored by an organization which also make the Funds available through a
qualified plan meeting the criteria specified under (a). In connection with
sales made to plans of the type described in the preceding sentence that are
clients of broker-dealers, and which do not qualify for sales at net asset value
under the conditions set forth in the paragraph above, payments may be made in
an amount equal to .50 of 1% of the net asset value of shares purchased. These
payments are subject to reclaim in the event shares are redeemed within twelve
months after purchase.

When Class A shares are sold, EKD will normally retain a portion of the
applicable sales charge and pay the balance to the broker-dealer or other
financial intermediary through whom the sale was made. EKD may also pay fees to
banks from sales charges for services performed on behalf of the customers of
such banks in connection with the purchase of shares of the Funds. In addition
to compensation paid at the time of sale, entities whose clients have purchased
Class A shares may receive a trailing commission equal to .25 of 1% of the
average daily value on an annual basis of Class A shares held by their clients.

Certain purchases of Class A shares may qualify for reduced sales charges in
accordance with a Fund's Combined Purchase Privilege, Cumulative Quantity
Discount, Statement of Intention, Privilege for Certain Retirement Plans and
Reinstatement Privilege. Consult the Share Purchase Application and Statement of
Additional Information for additional information concerning these reduced sales
charges.

CLASS B SHARES--DEFERRED SALES CHARGE ALTERNATIVE. You can purchase Class B
shares at net asset value without an initial sales charge. However, you may pay
a CDSC if you redeem shares within six years after purchase. Shares obtained
from dividend or distribution reinvestment are not subject to the CDSC. The
amount of the CDSC (expressed as a percentage of the lesser of the current net
asset value or original cost) will vary according to the number of years from
the purchase of Class B shares as set forth below.

<TABLE>
<CAPTION>
CONTINGENT DEFERRED SALES
YEAR SINCE PURCHASE CHARGE
- ---------------------------------------------------------------------------------------------- -------------------------
<S> <C>
FIRST......................................................................................... 5%
SECOND........................................................................................ 4%
THIRD AND FOURTH.............................................................................. 3%
FIFTH......................................................................................... 2%
SIXTH......................................................................................... 1%
</TABLE>

The CDSC is deducted from the amount of the redemption and is paid to EKD.
The CDSC will be waived on redemptions of shares following the death or
disability of a shareholder, to meet distribution requirements for certain
qualified retirement plans or in the case of certain redemptions made under a
Fund's Systematic Cash Withdrawal Plan. Class B shares are subject to higher
distribution and/or shareholder service fees than Class A shares for a period of
seven years (after which it is expected that they will convert to Class A
shares). The higher fees mean a higher expense ratio, so Class B shares pay
correspondingly lower dividends and may have a lower net asset value than Class
A shares. See the Statement of Additional Information for further details.

CLASS C SHARES--LEVEL-LOAD ALTERNATIVE. You can purchase Class C shares
without any initial sales charge and, therefore, the full amount of your
investment will be used to purchase Fund shares. However, you will pay a 1% CDSC
if you redeem shares during the first year after purchase. Class C shares incur
higher distribution and/or shareholder service fees than Class A shares but,
unlike Class B shares, do not convert to any other class of shares of the Fund.
The higher fees mean a higher expense ratio, so Class C shares pay
correspondingly lower dividends and may have a lower net asset value than Class
A shares. Shares obtained from dividend or distribution reinvestment are not
subject to the CDSC. The maximum amount of Class C Shares that may be purchased
by any investor is $500,000.

25
<PAGE>
With respect to Class B shares and Class C shares, no CDSC will be imposed
on: (1) the portion of redemption proceeds attributable to increases in the
value of the account due to increases in the net asset value per share, (2)
shares acquired through reinvestment of dividends and capital gains, (3) shares
held for more than six years (in the case of Class B shares) or one year (in the
case of Class C shares) after the end of the calendar month of acquisition, (4)
accounts following the death or disability of a shareholder, or (5) minimum
required distributions to a shareholder over the age of 70 1/2 from an IRA or
other retirement plan.

HOW THE FUNDS VALUE THEIR SHARES. The net asset value of each Class of
shares of each Fund is calculated by dividing the value of the amount of the
Fund's net assets attributable to that Class by the number of outstanding shares
of that Class. Shares are valued each day the New York Stock Exchange (the
"Exchange") is open as of the close of regular trading (currently 4:00 p.m.
Eastern time). The securities in a Fund are valued at their current market value
determined on the basis of market quotations or, if such quotations are not
readily available, such other methods as the Trustees of the Trust believe would
accurately reflect fair value. Non-dollar denominated securities will be valued
as of the close of the Exchange at the closing price of such securities in their
principal trading market.

GENERAL. The decision as to whether Class A, Class B or Class C shares are
more beneficial to you depends on the amount of your investment and the length
of time you will hold it. If you are making a large investment, thus qualifying
for a reduced sales charge, you might consider Class A shares. If you are making
a smaller investment, you might consider Class B shares since 100% of your
purchase is invested immediately and since such shares will convert to Class A
shares, which incur lower ongoing distribution and/or shareholder service fees,
after seven years. If you are unsure of the time period of your investment, you
might consider Class C shares since there are no initial sales charges and,
although there is no conversion feature, the CDSC only applies to redemptions
made during the first year. Consult your financial intermediary for further
information. The compensation received by dealers and agents may differ
depending on whether they sell Class A, Class B or Class C shares. There is no
size limit on purchases of Class A shares.

The Funds also offer Class Y shares, which may be purchased without any
sales charges, distribution fees and redemption fees. However, unlike Class A,
Class B and Class C shares, Class Y shares are not generally offered by most
broker-dealers, banks and other financial intermediaries that offer shares of
the Funds. As a result, investors purchasing Class Y shares are not expected to
receive any of the services that financial intermediaries may provide to their
customers who own shares of the Funds.

In addition to the discount or commission paid to dealers, EKD may pay cash
or non-cash compensation to dealers in connection with sales of shares of a
Fund. Non-cash compensation may be paid in recognition of past sales of Fund
shares or to encourage future sales and will take the form of payments for
gifts, attendance at lunches, sporting events or theater performance for persons
associated with a dealer and their guests and payments for associated persons to
attend education and training seminars in accordance with the rules of the NASD.
Such a dealer may elect to receive cash incentives of equivalent amount in lieu
of such payments. EKD may also limit the availability of such compensation to
certain specified dealers. EKD from time to time sponsors promotions involving
selected dealers, pursuant to which incentives are paid, including gift
certificates and payments in amounts up to 1% of the dollar amount of shares of
a Fund sold. Awards may also be made based on the opening of a minimum number of
accounts. Such promotions are not being made available to all dealers. Certain
broker-dealers may also receive payments from EKD or the Adviser over and above
the usual trail commissions or shareholder servicing payments applicable to a
given Class of shares.

26
<PAGE>
prohibited or restricted from making further purchases in the Funds. The Funds
will not accept third party checks other than those payable directly to a
shareholder whose account has been in existence at least thirty days.

HOW TO REDEEM SHARES

You may redeem shares of either Fund on any day the Exchange is open, either
directly or through your financial intermediary. The price you will receive is
the net asset value (less any applicable CDSC for Class B or Class C shares)
next computed after the Fund receives your redemption request in proper form.
Proceeds generally will be sent to you within seven days. However, for shares
recently purchased by check, a Fund will not send proceeds until it is
reasonably satisfied that the check has been collected (which may take up to ten
days). Once a redemption request has been telephoned or mailed, it is
irrevocable and may not be modified or canceled.

REDEEMING SHARES THROUGH YOUR FINANCIAL INTERMEDIARY. A Fund must receive
instructions from your financial intermediary before 4:00 p.m. (Eastern time)
for you to receive that day's net asset value (less any applicable CDSC for
Class B or Class C shares). Your financial intermediary is responsible for
furnishing all necessary documentation to a Fund and may charge you for this
service. Certain financial intermediaries may require that you give instructions
earlier than 4:00 p.m. (Eastern time).

REDEEMING SHARES DIRECTLY BY MAIL OR TELEPHONE. Shares may be redeemed by
sending a signed letter of instruction or stock power form to State Street Bank
and Trust Company ("State Street") at P.O. Box 9021, Boston, Massachusetts
02205-9827, which is the registrar, transfer agent and dividend-disbursing agent
for each Fund. Stock power forms are available from your financial intermediary,
State Street, and many commercial banks. Additional documentation is required
for the sale of shares by corporations, financial intermediaries, fiduciaries
and surviving joint owners. Signature guarantees are required for all redemption
requests for shares with a value of more than $50,000 or where the redemption
proceeds are to be mailed to an address other than that shown in the account
registration. A signature guarantee must be provided by a bank or trust company
(not a Notary Public), a member firm of a domestic stock exchange or by other
financial institutions whose guarantees are acceptable to State Street.

Shareholders may withdraw amounts of $1,000 or more from their accounts by
calling the phone number on the front page of this Prospectus between the hours
of 8:00 a.m. and 5:30 p.m. (Eastern time) each business day (i.e., any weekday
exclusive of days on which the Exchange or State Street's offices are closed).
The Exchange is closed on New Year's Day, Martin Luther King Day, Presidents
Day, Good Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving Day
and Christmas Day.

Redemption requests received after 4:00 p.m. (Eastern time) will be
processed using the net asset value determined on the next business day.
Redemption requests must include the shareholder's account name, as registered
with a Fund, and the account number. During periods of unusual economic or
market changes, shareholders may experience difficulty in effecting telephone
redemptions. Shareholders who are unable to reach a Fund by telephone should
follow the procedures outlined above for redemption by mail.

27
<PAGE>
financial institutions whose guarantees are acceptable to State Street.
Shareholders should allow approximately ten days for such form to be processed.
The Funds will employ reasonable procedures to verify that telephone requests
are genuine. These procedures include requiring some form of personal
identification prior to acting upon instructions and tape recording of
conversations. If a Fund fails to follow such procedures, it may be liable for
any losses due to unauthorized or fraudulent instructions. The Fund shall not be
liable for following telephone instructions reasonably believed to be genuine.
Also, each Fund reserves the right to refuse a telephone redemption request, if
it is believed advisable to do so. Financial intermediaries may charge a fee for
handling telephonic requests. The telephone redemption option may be suspended
or terminated at any time without notice.

GENERAL. The redemption of shares is a taxable transaction for Federal
income tax purposes. Under unusual circumstances, a Fund may suspend redemptions
or postpone payment for up to seven days or longer, as permitted by Federal
securities law. The Funds reserve the right to close an account that as a result
of one or more redemptions has remained below $1,000 for thirty days.
Shareholders will receive sixty days' written notice to increase the account
value before the account is closed. The Funds have elected to be governed by
Rule 18f-1 under the 1940 Act pursuant to which each Fund is obligated to redeem
shares solely in cash, up to the lesser of $250,000 or 1% of a Fund's total net
assets during any ninety day period for any one shareholder. See the Statement
of Additional Information for further details.

EXCHANGE PRIVILEGE

HOW TO EXCHANGE SHARES. You may exchange some or all of your shares of a
Fund for shares of the same Class in the other Fund through your financial
intermediary, or by telephone or mail as described below. In addition, until
April 3, 1998, you may exchange some or all of your shares for shares of the
same Class in the Evergreen Keystone Funds. After April 3, 1998, however, shares
of the Funds will no longer be exchangeable into or for shares of the Evergreen
Keystone funds. Once an exchange request has been telephoned or mailed, it is
irrevocable and may not be modified or canceled. Exchanges will be made on the
basis of the relative net asset value of the shares exchanged next determined
after an exchange request is received. An exchange which represents an initial
investment in another mutual fund is subject to the minimum investment and
suitability requirements of each fund.

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

No CDSC will be imposed in the event Class B or Class C shares of one Fund
are exchanged for Class B or Class C shares, respectively, of the other Fund or
an Evergreen/Keystone mutual fund. If you redeem shares, the CDSC applicable to
the Class B or Class C shares of the mutual fund originally purchased for cash
is applied. Also, Class B shares will continue to age following an exchange for
purposes of conversion to Class A shares and determining the amount of the
applicable CDSC upon a redemption.

EXCHANGES THROUGH YOUR FINANCIAL INTERMEDIARY. A Fund must receive exchange
instructions from your financial intermediary before 4:00 p.m. (Eastern time)
for you to receive that day's net asset value. Your financial intermediary is
responsible for furnishing all necessary documentation to a Fund and may charge
you for this service.

28
<PAGE>
day. During periods of unusual economic or market changes, shareholders may
experience difficulty in effecting telephone exchanges. You should follow the
procedures outlined below for exchanges by mail if you are unable to reach State
Street by telephone. If you wish to use the telephone exchange service you
should indicate this on the Share Purchase Application. Each Fund will employ
reasonable procedures to confirm that instructions for the redemption or
exchange of shares communicated by telephone are genuine. A telephone exchange
may be refused by a Fund or State Street if it is believed advisable to do so.
Procedures for exchanging Fund shares by telephone may be modified or terminated
at any time. Written requests for exchanges should follow the same procedures
outlined for written redemption requests in the section entitled "How to Redeem
Shares", however, no signature guarantee is required.

SHAREHOLDER SERVICES

The Funds offer the following shareholder services. For more information
about these services or your account, contact your financial intermediary, the
distributor of shares of the Funds or the toll-free number on the front page of
this Prospectus. Some services are described in more detail in the Share
Purchase Application.

SYSTEMATIC INVESTMENT PLAN. You may make monthly or quarterly investments
into an existing account automatically in amounts of not less than $25 per month
or $75 per quarter. Each Fund reserves the right to close an account that
through liquidation or termination of the Systematic Investment Plan has not
reached a minimum balance of $1,000 ($250 for retirement accounts) within 24
months of the initial investment.

TELEPHONE INVESTMENT PLAN. You may make investments into an existing
account electronically in amounts of not less than $100 or more than $10,000 per
investment. Telephone investment requests received by 3:00 p.m. (Eastern time)
will be credited to a shareholder's account the day the request is received.

Shares purchased under the Funds' Systematic Investment Plan or Telephone
Investment Plan may not be redeemed for ten days from the date of investment.

SYSTEMATIC CASH WITHDRAWAL PLAN. When an account of $10,000 or more is
opened or when an existing account reaches that size, you may participate in the
Funds Systematic Cash Withdrawal Plan by filling out the appropriate part of the
Share Purchase Application. Under this plan, you may receive (or designate a
third party to receive) a monthly or quarterly check in a stated amount of not
less than $75. Fund shares will be redeemed as necessary to meet withdrawal
payments. All participants must elect to have their dividends and capital gain
distributions reinvested automatically. Any applicable Class B CDSC will be
waived with respect to redemptions occurring under a Systematic Cash Withdrawal
Plan during a calendar year to the extent that such redemptions do not exceed
10% of (i) the initial value of the account plus (ii) the value, at the time of
purchase, of any subsequent investments.

INVESTMENTS THROUGH EMPLOYEE BENEFIT AND SAVINGS PLANS. Certain qualified
and non-qualified benefit and savings plans may make shares of the Funds
available to their participants. Investments made by such employee benefit plans
may be exempt from front-end sales charges if they meet the criteria set forth
under "Class A Shares-Front End Sales Charge Alternative". The Funds' investment
adviser may provide compensation to organizations providing administrative and
recordkeeping services to plans which make shares of the Funds available to
their participants.

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

29
<PAGE>
Postal Service cannot deliver the checks, or if the checks remain uncashed for
six months, the checks will be reinvested into your account at the then current
net asset value.

TAX SHELTERED RETIREMENT PLANS. Eligible investors may open a pension and
profit sharing account in a Fund under the following prototype retirement plans:
(i) Individual Retirement Accounts ("IRAs") and Rollover IRAs; (ii) Simplified
Employee Pension ("SEP") for sole proprietors, partnerships and corporations;
and (iii) Profit-Sharing and Money Purchase Pension Plans for corporations and
their employees.

DIVIDENDS, DISTRIBUTIONS AND TAXES

It is the policy of each Fund to distribute to shareholders its investment
company income, if any, annually and any net realized capital gains annually or
more frequently as required as a condition of continued qualification as a
regulated investment company by the Code. Dividends and distributions generally
are taxable in the year in which they are paid, except any dividends paid in
January that were declared in the previous calendar quarter may be treated as
paid in December of the previous year. Income dividends and capital gain
distributions are automatically reinvested in additional shares of the Fund
making the distribution at the net asset value per share at the close of
business on the record date, unless the shareholder has made a written request
for payment in cash.

Each Fund has qualified and intends to continue to qualify to be treated as
a regulated investment company under the Code. While so qualified, it is
expected that each Fund will not be required to pay any Federal income tax on
that portion of its investment company taxable income and any net realized
capital gains it distributes to shareholders. The Code imposes a 4%
nondeductible excise tax on regulated investment companies, such as the Funds,
to the extent they do not meet certain distribution requirements by the end of
each calendar year. Each Fund anticipates meeting such distribution
requirements. Most shareholders of the Funds normally will have to pay Federal
income tax and any state or local taxes on the dividends and distributions they
receive from a Fund whether such dividends and distributions are made in cash or
in additional shares. Questions on how any distributions will be taxed to the
investor should be directed to the investor's own tax adviser.

Under current law, the highest Federal income tax rate applicable to net
long-term capital gains realized by individuals is 20% with respect to gain from
capital assets held for more than eighteen months, and 28% with respect to gain
from capital assets held for more than twelve months. The rate applicable to
corporations is 35%. Certain income from a Fund may qualify for a corporate
dividends-received deduction of 70%. Following the end of each calendar year,
every shareholder of the Fund will be sent applicable tax information and
information regarding the dividends and capital gain distributions made during
the calendar year. A Fund may be subject to foreign withholding taxes which
would reduce the yield on its investments. Tax treaties between certain
countries and the United States may reduce or eliminate such taxes. Shareholders
of a Fund who are subject to United States Federal income tax may be entitled,
subject to certain rules and limitations, to claim a Federal income tax credit
or deduction for foreign income taxes paid by a Fund. See the Statement of
Additional Information for additional details. A Fund's transactions in options,
futures and forward contracts may be subject to special tax rules. These rules
can affect the amount, timing and characteristics of distributions to
shareholders.

If more than 50% of the value of a Fund's assets at the end of the tax year
is represented by stock or securities of foreign corporations, the Fund intends
to qualify for certain Code elections that would allow shareholders to claim a
foreign tax credit or deduction on their U.S. income tax returns. The Code may
limit a shareholder's ability to claim a foreign tax credit. Furthermore,
shareholders who elect to deduct their portion of a Fund's foreign taxes rather
than take the foreign tax credit must itemize deductions on their income tax
returns.

30
<PAGE>
form supplied by State Street, that your social security or taxpayer
identification number is correct and that you are not currently subject to
backup withholding or are exempt from backup withholding. A shareholder who
acquires Class A shares of a Fund and sells or otherwise disposes of such shares
within ninety days of acquisition may not be allowed to include certain sales
charges incurred in acquiring such shares for purposes of calculating gain and
loss realized upon a sale or exchange of shares of the Fund.

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

GENERAL INFORMATION

PORTFOLIO TRANSACTIONS. Consistent with the Rules of Fair Practice of the
National Association of Securities Dealers, Inc., and subject to seeking best
price and execution, a Fund may consider sales of its shares as a factor in the
selection of dealers to enter into portfolio transactions with the Fund.

ORGANIZATION. The Funds are separate series of the Alpine Equity Trust
(formerly Evergreen Equity Trust), a Massachusetts business trust organized in
1988. The Funds do not intend to hold annual shareholder meetings; shareholder
meetings will be held only when required by applicable law. Shareholders have
available certain procedures for the removal of Trustees, including the right to
demand that a meeting of shareholders be called for the purpose of voting
thereon if 10% of the shareholders so request in writing.

A shareholder in each Class of a Fund will be entitled to his or her share
of all dividends and distributions from a Fund's assets, based upon the relative
value of such shares to those of other Classes of the Fund, and, upon redeeming
shares, will receive the then current net asset value of the Class of shares of
the Fund represented by the redeemed shares less any applicable contingent
deferred sales charge. The Trust is empowered to establish, without shareholder
approval, additional investment series, which may have different investment
objectives, and additional classes of shares for any existing or future series.
If an additional series or class were established in a Fund, each share of the
series or class would normally be entitled to one vote for all purposes.
Generally, shares of each series and class would vote together as a single class
on matters, such as the election of Trustees, that affect each series and class
in substantially the same manner. Class A, Class B, Class C and Class Y shares
have identical voting, dividend, liquidation and other rights, except that each
class bears, to the extent applicable, its own distribution, shareholder service
and transfer agency expenses as well as any other expenses applicable only to a
specific Class. Each Class of shares votes separately with respect to Rule 12b-1
distribution plans and other matters for which separate class voting is
appropriate under applicable law. Shares are entitled to dividends as determined
by the Trustees and, in liquidation of a Fund, are entitled to receive the net
assets of the Fund.

CUSTODIAN, REGISTRAR, TRANSFER AGENT AND DIVIDEND-DISBURSING AGENT. State
Street Bank and Trust Company, P.O. Box 9021, Boston, Massachusetts 02205-9827
acts as each Fund's custodian, registrar, transfer agent and dividend-disbursing
agent. State Street is compensated for its services as transfer agent by a fee
based upon the number of shareholder accounts maintained for the Funds. The
transfer agency fee with respect to the Class B shares will be higher than the
transfer agency fee with respect to the Class A shares or Class C shares. FUNB
may act as sub-transfer agent in connection with certain telephone services
provided to the Funds' shareholders, and with respect to shareholders
participating in certain employee benefit plans for which FUNB provides
recordkeeping services.

31
<PAGE>
PRINCIPAL UNDERWRITER. EKD, an affiliate of BISYS Fund Services, located at
120 Clove Road, Little Falls, New Jersey 07424, is the principal underwriter of
the Funds. BISYS Fund Services provides certain sub-administrative services to
the Adviser in connection with its role as investment adviser to Funds.

OTHER CLASSES OF SHARES. Each Fund currently offers four classes of shares,
Class A, Class B, Class C and Class Y, and may in the future offer additional
classes. Class Y shares are not offered by this Prospectus. The dividends
payable with respect to Class A, Class B and Class C shares will be less than
those payable with respect to Class Y shares due to the distribution and
shareholder servicing related expenses borne by Class A, Class B and Class C
shares and the fact that such expenses are not borne by Class Y shares.

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

In marketing a Fund's shares, information may be provided that is designed
to help individuals understand their investment goals and explore various
financial strategies. Such information may include publications describing
general principles of investing, such as asset allocation, diversification, risk
tolerance, and goal setting; a questionnaire designed to help create a personal
financial profile; and an action plan offering investment alternatives. In
addition, the information provided to investors may quote financial or business
publications and periodicals, including model portfolios or allocations, as they
relate to fund management, investment philosophy, and investment techniques.

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

LIABILITY UNDER MASSACHUSETTS LAW. Under Massachusetts law, Trustees and
shareholders of a business trust may, in certain circumstances, be held
personally liable for its obligations. The Trust's Declarations of Trust
provides that no Trustee or shareholder will be personally liable for the
obligations of the Trust and that every written contract made by the Trust
contain a provision to that effect. If any Trustee or shareholder were required
to pay any liability of the Trust, that person would be entitled to
reimbursement from the general assets of the Trust.

CONTROL PERSONS. As of January 12, 1998, Stephen A. Lieber may be deemed to
control the Fund through his direct and indirect beneficial ownership of more
than 25 percent of the Fund's outstanding shares.

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

32
<PAGE>
INVESTMENT ADVISER

Alpine Management & Research, LLC, 2500 Westchester Avenue, Purchase, New York
10577

CUSTODIAN & TRANSFER AGENT

State Street Bank and Trust Company, Box 9021, Boston, Massachusetts 02205-9827

LEGAL COUNSEL

Schulte Roth & Zabel LLP, 900 Third Avenue, New York, New York 10022

INDEPENDENT AUDITORS

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

DISTRIBUTOR

Evergreen Keystone Distributor, Inc., 120 Clove Road, Little Falls, New Jersey
07424

33
<PAGE>
PROSPECTUS FEBRUARY , 1998

ALPINE U.S. REAL ESTATE EQUITY FUND
ALPINE INTERNATIONAL REAL ESTATE EQUITY FUND
SERIES OF ALPINE EQUITY TRUST

CLASS Y SHARES

------------------

Alpine Management & Research, LLC serves as the investment adviser of the
Funds.

This Prospectus contains important information regarding the Funds and sets
forth concise information about the Funds that a prospective investor in Class Y
shares should know before investing. The address of the Funds is 2500
Westchester Avenue, Purchase, New York 10577.

------------------------

<TABLE>
<CAPTION>
PAGE
-----
<S> <C>
OVERVIEW OF THE FUNDS...................................................................................... 3

EXPENSE INFORMATION........................................................................................ 4

FINANCIAL HIGHLIGHTS....................................................................................... 5

DESCRIPTION OF THE FUNDS................................................................................... 9

INVESTMENT INSTRUMENTS AND PRACTICES....................................................................... 10

DERIVATIVE INVESTMENTS..................................................................................... 16

INVESTMENT RESTRICTIONS.................................................................................... 19

RISK CONSIDERATIONS........................................................................................ 19

MANAGEMENT OF THE FUNDS.................................................................................... 20

PURCHASE AND REDEMPTION OF SHARES.......................................................................... 21

EXCHANGE PRIVILEGE......................................................................................... 23

SHAREHOLDER SERVICES....................................................................................... 23

DIVIDENDS, DISTRIBUTIONS AND TAXES......................................................................... 24

GENERAL INFORMATION........................................................................................ 25
</TABLE>

2
<PAGE>
OVERVIEW OF THE FUNDS

The following summary is qualified in its entirety by the more detailed
information contained elsewhere in this Prospectus. See "DESCRIPTION OF THE
FUNDS" and "MANAGEMENT OF THE FUNDS".

3
<PAGE>
EXPENSE INFORMATION

The table set forth below summarizes the shareholder transaction costs
associated with an investment in Class Y Shares of each of the Funds. For
further information see "PURCHASE AND REDEMPTION OF SHARES" and "GENERAL
INFORMATION--Other Classes of Shares".

SHAREHOLDER TRANSACTION EXPENSES

<TABLE>
<S> <C>
Maximum Sales Charge Imposed on Purchases (as % of offering price)... None
Sales Charge on Dividend Reinvestments............................... None
Contingent Deferred Sales Charge..................................... None
Redemption Fee....................................................... None
</TABLE>

The following tables show the estimated annual operating expenses associated
with an investment in Class Y Shares of each of the Funds (as a percentage of
its average net assets), together with examples of the cumulative effect of such
expenses on a hypothetical $1,000 investment for the periods specified,
assuming: (i) a 5% annual return, and (ii) redemption at the end of each period.

ALPINE U.S. REAL ESTATE EQUITY FUND

<TABLE>
<CAPTION>
ASSUMING REDEMPTION
ANNUAL OPERATING AT
EXPENSES END OF PERIOD
---------------------
<S> <C> <C> <C>
After 1 Year $ [ -------]
Management Fees................. 1.00% After 3 Years $ [ -------]
Other Expenses.................. [ --------%] After 5 Years $ [ -------]
------
After 10
Total........................... [ --------%] Years $ [ -------]
------
------
</TABLE>

ALPINE INTERNATIONAL REAL ESTATE EQUITY FUND

<TABLE>
<CAPTION>
ASSUMING REDEMPTION
ANNUAL OPERATING AT
EXPENSES(1) END OF PERIOD
---------------------
<S> <C> <C> <C>
After 1 Year $ [ -------]
Management Fees............... 1.00% After 3 Years $ [ -------]
Other Expenses................ [ ---------%] After 5 Years $ [ -------]
------
After 10
Total......................... [ ---------%] Years $ [ -------]
------
------
</TABLE>

The purpose of the foregoing tables is to assist an investor in
understanding the various costs and expenses that an investor in the Class Y
Shares of the Funds will bear directly or indirectly. The amounts set forth both
in the tables and in the examples are estimated amounts based on the operating
expenses of each Fund for the most recent fiscal period without giving effect to
any fee waivers or expense reimbursements that were in effect during that
period. THE EXAMPLES SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE
EXPENSES OR ANNUAL RETURN. ACTUAL EXPENSES AND ANNUAL RETURN MAY BE GREATER OR
LESS THAN THOSE SHOWN. For a more complete description of the various costs and
expenses borne by the Funds see "MANAGEMENT OF THE FUNDS".

FINANCIAL HIGHLIGHTS

4
<PAGE>
Fund's Statement of Additional Information. The following information for each
Fund should be read in conjunction with the financial statements and related
notes which are incorporated by reference in the Fund's Statement of Additional
Information.

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

5
<PAGE>
ALPINE U.S. REAL ESTATE EQUITY FUND

<TABLE>
<CAPTION>
CLASS Y SHARES
-----------------------------------------------------------------
SEPTEMBER 1, 1993*
YEAR ENDED SEPTEMBER 30, THROUGH
-------------------------------------------- DECEMBER 31,
1997++ 1996++ 1995 1994**++ 1993
--------- --------- --------- ----------- -------------------
<S> <C> <C> <C> <C> <C>
PER SHARE DATA:
Net asset value beginning of year........................ $ 12.56 $ 11.44 $ 10.07 $ 10.71 $ 10.00
--------- --------- --------- ----------- ------
Income from investment operations
Net investment income.................................... 0.16# 0.24 0.23 0.11 0.04
Net realized and unrealized gain (loss) on investments... 8.63 1.29 1.46 (0.75) 0.72
--------- --------- --------- ----------- ------
Total from investment operations..................... 8.79 1.53 1.69 (0.64) 0.76
--------- --------- --------- ----------- ------
Less distributions from
Net investment income.................................... (0.28)# (0.20) (0.20) 0 (0.04)
In excess of net investment income....................... 0 0 0 0 (0.01)

Net realized gains on investments........................ (1.58) (0.21) (0.12) 0 0
--------- --------- --------- ----------- ------
Total distributions.................................. (1.86) (0.41) (0.32) 0 (0.05)
--------- --------- --------- ----------- ------
Net asset value, end of year......................... $ 19.49 $ 12.56 $ 11.44 $ 10.07 $ 10.71
--------- --------- --------- ----------- ------
--------- --------- --------- ----------- ------
TOTAL RETURN##........................................... 78.79% 13.57% 17.63% (5.98%) 7.60%
RATIOS/SUPPLEMENTAL DATA
Net assets end of year (thousands)....................... $ 19,459 $ 10,601 $ 9,456 $ 8,630 $ 4,610
Ratios to average net assets:
Total expenses......................................... 1.51% 1.46% 1.50% 1.49%+ 0.44+
Interest expense....................................... N/A 0.04% N/A N/A N/A
Total expenses, excluding indirectly paid expenses..... 1.50% N/A N/A N/A N/A
Total expenses, excluding fee waivers & expense
reimbursements....................................... 2.26% 2.25% 2.70% 2.65%+ 3.59%+
Net investment income.................................. 1.10% 2.02% 2.45%+ 1.60%+ 1.93%+
Portfolio turnover rate.................................. 205% 169% 115% 102% 17%
Average commission rate paid per share................... $ 0.0597 $ 0.0619 N/A N/A N/A
</TABLE>

- ------------------------------

++ Calculated based on average shares outstanding throughout the period.

* Commencement of class operations.

** For the nine months ended September 30, 1994. The Fund changed its fiscal
year end from December 31 to September 30, effective September 30, 1994.

+ Annualized.

## Total return is calculated on net asset value for the periods and is not
annualized.

6
<PAGE>
ALPINE INTERNATIONAL REAL ESTATE EQUITY FUND

<TABLE>
<CAPTION>
CLASS Y SHARES
-------------------------------
YEAR ENDED OCTOBER 31,
-------------------------------
1997 1996 1995#
--------- --------- ---------
<S> <C> <C> <C>
PER SHARE DATA:
Net asset value beginning of year..................................................... $ 12.31 $ 11.59 $ 12.13
Income (loss) from investment operations:*
Net investment income (loss)........................................................ (0.03) 0.01 (0.01)
Net realized and unrealized gain (loss) on investments and foreign currency related
transactions...................................................................... 0.71 0.71 (0.53)
--------- --------- ---------
Total from investment operations.................................................... 0.68 0.72 (0.54)
--------- --------- ---------
Less distributions from
Net investment income............................................................... (0.02) 0 0
Net asset value end of year........................................................... $ 12.97 $ 12.31 $ 11.59
--------- --------- ---------
--------- --------- ---------
TOTAL RETURN**........................................................................ 5.5% 6.2% (4.5%)
--------- --------- ---------
--------- --------- ---------
RATIOS & SUPPLEMENTAL DATA:
Net assets end of year (thousands).................................................... $ 35,234 $ 47,502 $ 61,418
Ratios to average net assets:
Expenses............................................................................ 1.82% 1.62% 1.62%++
Interest expense.................................................................... 0.03% 0.03% 0.03%++
Expenses, excluding indirectly paid expenses........................................ 1.82% N/A N/A
Expenses, excluding fee waivers & expense reimbursements............................ 1.90% 1.67% N/A
Net investment income (loss)........................................................ (0.21%) 0.11% (1.14%)++
PORTFOLIO TURNOVER RATE............................................................... 44% 25% 1%
AVERAGE COMMISSION RATE PER SHARE..................................................... $ .0039 $ .0037 N/A
</TABLE>

<TABLE>
<CAPTION>
YEAR ENDED SEPTEMBER
30, YEAR ENDED DECEMBER 31, FEBRUARY 1, 1989
-------------------- ------------------------------------------ THROUGH
1995 1994## 1993 1992 1991 1990 DECEMBER 31, 1989+
--------- --------- --------- --------- --------- --------- ---------------------
<S> <C> <C> <C> <C> <C> <C> <C>
PER SHARE DATA:
Net asset value beginning of
year............................ $ 13.81 $ 14.75 $ 9.86 $ 9.16 $ 8.10 $ 10.03 $ 10.00
--------- --------- --------- --------- --------- --------- -------
Income (loss) from investment
operations:*
Net investment income (loss).... 0.11 0.07 0 (.01) (.02) (.03) .17
Net realized and unrealized gain
(loss) on investments and
foreign currency related
transactions.................. (1.17) (1.01) 5.07 .94 1.08 (1.90) .03
Total from investment
operations.................... (1.06) (0.94) 5.07 .93 1.06 (1.93) .20
--------- --------- --------- --------- --------- --------- -------
Less distributions from:
Net investment income........... (0.10) 0 0 0 0 0 (.17)
Net realized gain on
investments................... (0.52) 0 (0.18) (.23) 0 0 0
Total contributions............. (0.62) 0 (0.18) (.23) 0 0 (.17)
--------- --------- --------- --------- --------- --------- -------
Net asset value end of year....... $ 12.13 $ 13.81 $ 14.75 $ 9.86 $ 9.16 $ 8.10 $ 10.03
--------- --------- --------- --------- --------- --------- -------
--------- --------- --------- --------- --------- --------- -------
TOTAL RETURN**.................... (7.7%) (6.4%) 51.4% 10.2% 13.1% (19.2%) 2.0%
--------- --------- --------- --------- --------- --------- -------
--------- --------- --------- --------- --------- --------- -------
</TABLE>

7
<PAGE>
ALPINE INTERNATIONAL REAL ESTATE EQUITY FUND

<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C>
RATIOS & SUPPLEMENTAL DATA:
Net assets end of year
(thousands)..................... $ 67,645 $ 132,294 $ 146,173 $ 8,618 $ 7,557 $ 6,004 $ 7,336
Ratios to average net assets:
Expenses........................ 1.54 1.46%++ 1.56%@ 2.00%@ 2.00%@ 2.00%@ 2.00%++@
Interest expense................ 0.05% 0.08%++ N/A N/A N/A N/A N/A
Expenses excluding indirectly
paid expenses................. N/A N/A N/A N/A N/A N/A N/A
Expenses excluding fee waivers &
expense reimbursement......... N/A N/A 1.64% N/A N/A N/A N/A
Net investment income (loss).... 0.92% 0.56%++ 0.03%@ (.10%)@ (.27%)@ (.39%)@ 2.23%++@
PORTFOLIO TURNOVER RATE........... 28% 63% 88% 245% 207% 325% 151%
AVERAGE COMMISSION RATE PER
SHARE........................... N/A N/A N/A N/A N/A N/A N/A
</TABLE>

- ------------------------------

* Net investment income is based on average monthly shares outstanding.

# The Fund changed its year end from September 30 to October 31, effective
October 31, 1995.

## The Fund changed its fiscal year end from December 31 to September 30.

** Initial sales charge or contingent deferred sales charge is not reflected.

++ Annualized.

+ Commencement of operations.

@ Net of expenses and reimbursements. If the Fund had borne all expenses that
were assumed or waived by the investment adviser, the annualized ratios of
expenses and net investment income (loss) to average net assets, exclusive
of any applicable state expense limitations, would have been the following:

<TABLE>
<CAPTION>
YEAR ENDED
DECEMBER 31, FEBRUARY 1, 1989+
YEAR ENDED -------------------------------------------- THROUGH
OCTOBER 31, 1996 1993 1992 1991 1990 DECEMBER 31, 1989
------------------- ----- --------- --------- --------- ---------------------
<S> <C> <C> <C> <C> <C> <C>
Operating expenses.............. 1.67% 1.64% 3.72% 3.76% 3.99% 3.17%
Net investment income (loss).... .06% (.05) (1.82%) (2.02%) (2.38%) 1.06%
</TABLE>

8
<PAGE>
DESCRIPTION OF THE FUNDS

INVESTMENT OBJECTIVES AND POLICIES

ALPINE U.S. REAL ESTATE EQUITY FUND

9
<PAGE>
ALPINE INTERNATIONAL REAL ESTATE EQUITY FUND

INVESTMENT INSTRUMENTS AND PRACTICES

10
<PAGE>
EQUITY SECURITIES

SMALLER COMPANIES

FIXED INCOME SECURITIES

The Funds may invest in both investment grade and non-investment grade debt
securities. Investment grade debt securities are those securities that have
received a rating from Standard & Poor's Ratings Group, a division of the
McGraw-Hill Companies, Inc. ("S&P") or Moody's Investors Service, Inc.
("Moody's") in one of the four highest rating categories or, if not rated, have
been determined by the Adviser to be of comparable quality to such rated
securities. Non-investment grade debt securities (typically called "junk bonds")
are securities that have received a rating from S&P or Moody's of below
investment grade or that have been given no rating and are of comparable quality
to such rated securities. Lower grade securities are considered to be
predominantly speculative with respect to the issuer's capacity to pay interest
and repay principal. Non-investment grade debt securities in the lowest rating
categories may involve a substantial risk of default. Changes in economic
conditions or developments regarding the individual issuer are more likely to
cause price volatility and weaken the capacity of the issuers of non-investment
grade debt securities to make principal and interest payments than is the case
for higher grade debt securities. An economic downturn affecting an issuer of
non-investment grade debt securities may

11
<PAGE>
result in an increased incidence of default. In addition, the market for lower
grade debt securities may be thinner and less active than for higher grade debt
securities. For these reasons, neither Fund will invest more than 15% of the
value of its total assets in fixed income securities which are not of investment
grade.

FOREIGN SECURITIES

EMERGING MARKETS

12
<PAGE>
Prior governmental approval for foreign investments may be required under
certain circumstances in some emerging countries, and the extent of foreign
investment in certain debt securities and domestic companies may be subject to
limitation in other emerging countries. Foreign ownership limitations also may
be imposed by the charters of individual companies in emerging countries to
prevent, among other concerns, violation of foreign investment limitations.
Repatriation of investment income, capital and the proceeds of sales by foreign
investors may require governmental registration or approval in some emerging
countries. A Fund could be adversely affected by delays in, or a refusal to
grant, any required governmental registration or approval for such repatriation.
Any investment subject to such repatriation controls will be considered illiquid
if it appears reasonably likely that this process will take more than seven
days.

TEMPORARY INVESTMENTS

SHORT SALES

13
<PAGE>
accomplished by a later purchase of the security by the Fund to close its short
position. When a Fund effects a short sale, it must maintain collateral in a
segregated account consisting of cash or liquid portfolio securities with a
value equal to the current market value of the securities sold short, which is
marked to market daily. A short sale involves the risk that the security sold
short may increase in value before the Fund purchases it, and the Fund could
incur a loss. Theoretically, an unlimited increase in the market price of the
security would result in an unlimited loss to the Fund. The Funds will incur
transaction costs, including interest expense, in connection with opening,
maintaining and closing short sales.

PORTFOLIO TURNOVER AND BROKERAGE

WHEN-ISSUED AND DELAYED DELIVERY TRANSACTIONS

The Funds may purchase or sell securities on a when-issued or delayed
delivery basis. These transactions are arrangements in which the Funds purchase
securities with payment and delivery scheduled for a future time. The seller's
failure to complete these transactions may cause the Funds to miss a price or
yield considered to be advantageous. Settlement dates may be a month or more
after entering into these transactions, and the market values of the securities
purchased may vary from the purchase prices. Thus, the Funds may pay more or
less than the market value of the securities on the settlement date. A Fund may
dispose of a commitment prior to settlement if the Adviser deems it appropriate
to do so. In addition, the Funds may enter into transactions to sell their
purchase commitments to third parties at current market values and
simultaneously acquire other commitments to purchase similar securities at later
dates. The Funds may realize short-term profits or losses upon the sale of such
commitments. When a Fund enters into a when-issued and delayed delivery
transaction, it will "cover" its position by maintaining in a segregated account
with the Fund's custodian, cash or liquid securities held by the Fund and having
a value (determined daily) equal to or greater than the purchase commitment or
delivery obligation of the Fund.

14
<PAGE>
ILLIQUID SECURITIES

BORROWING

LENDING OF PORTFOLIO SECURITIES

15
<PAGE>
call a loan and obtain the securities loaned at any time on notice of not more
than five business days. A Fund may pay reasonable fees in connection with such
loans.

CROSS HEDGING

SECURITIES OF OTHER INVESTMENT COMPANIES

Each Fund may invest in the securities of other open-end investment
companies that have investment objectives and policies similar to its own. The
Funds may also purchase shares of money market funds that invest in U.S.
Government securities and repurchase agreements, in lieu of purchasing money
market instruments directly. Any investment by a Fund in the securities of other
investment companies will be subject to the limitations on such investments
contained in the Investment Company Act of 1940 (the "1940 Act").

The Funds, as investors in another investment company, including a money
market fund, will indirectly bear the fees and expenses of that fund, which will
be in addition to the fees and expenses of the Funds.

DIVERSIFICATION

DERIVATIVE INVESTMENTS

16
<PAGE>
could have a large potential positive or negative impact on a Fund's net asset
value per share or investment performance. If a Fund invests in Derivatives at
inappropriate times or judges market conditions incorrectly, such investments
may lower the Fund's return or result in losses. Changes in the liquidity of the
secondary markets in which a Fund's Derivatives may trade could result in
significant, rapid and unpredictable changes in the prices of such Derivatives,
which could also cause losses to the Fund.

OPTIONS ON SECURITIES

17
<PAGE>
various derivative instruments may be illiquid and, in such cases are subject to
the limitations on the purchase of illiquid securities by the Funds.

OPTIONS ON SECURITIES INDICES

OPTIONS ON FOREIGN CURRENCIES

No more than 5% of a Fund's net assets may be represented by premiums paid
by the Fund with respect to options on foreign currencies outstanding at any one
time. The Funds may engage in these transactions for the purpose of protecting
against declines in the U.S. dollar value of portfolio securities or in the U.S.
dollar value of dividends or interest expected to be received on those
securities. These transactions may also be used to protect against increases in
the U.S. dollar cost of securities to be acquired by the Funds. As with other
types of options, however, writing an option on foreign currency constitutes
only a partial hedge, up to the amount of the premium received, and the Funds
could be required to purchase or sell foreign currencies at disadvantageous
exchange rates, thereby incurring losses. Certain options on foreign currencies
are traded on the over-the-counter market and involve liquidity and credit risks
that may not be present in the case of exchange traded currency options.

18
<PAGE>
FUTURES CONTRACTS

The purchase and sale of futures contracts and related options involve risks
different from those involved with direct investments in securities and also
require different skills from the Adviser in managing the Funds' portfolios of
investments. While utilization of futures contracts and similar instruments may
be advantageous to the Funds, if the Adviser is not successful in employing such
instruments in managing the Funds' investments or in predicting market changes,
the Funds' investment performance will be worse than if the Funds did not make
such investments. It is possible that there will be imperfect correlation, or
even no correlation, between price movements of the investments being hedged and
the options or futures used. It is also possible that a Fund may be unable to
purchase or sell a portfolio security at a time that otherwise would be
favorable for it to do so, or that a Fund may need to sell a portfolio security
at a disadvantageous time, due to the need for the Fund to maintain "cover" or
to segregate securities in connection with its futures transactions, or that a
Fund may be unable to close out or liquidate its hedged position. In addition, a
Fund will pay commissions and incur other costs in connection with transactions
in futures, which may increase the expenses of the Funds.

INVESTMENT RESTRICTIONS

RISK CONSIDERATIONS

Risks associated with investment in securities of companies in the real
estate industry include: declines in the value of real estate, risks related to
general and local economic conditions, overbuilding and increased competition,
increases in property taxes and operating expenses, changes in zoning laws,
casualty or condemnation losses, variations in rental income, changes in
neighborhood values, the appeal of properties to tenants and increases in
interest rates. In addition, equity real estate investment trusts may be
affected by changes in the value of the underlying property owned by the trusts,
while mortgage real estate investment trusts may be affected by the quality of
credit extended. Equity and mortgage real estate

19
<PAGE>
investment trusts are dependent upon management skills, may not be diversified
and are subject to the risks of financing projects. Such trusts are also subject
to heavy cash flow dependency, defaults by borrowers, self liquidation and the
possibility of failing to qualify for tax-free pass-through of income under the
Internal Revenue Code of 1986, as amended (the "Code") and to maintain exemption
from the 1940 Act. In the event an issuer of debt securities collateralized by
real estate defaulted, it is conceivable that a Fund could end up holding the
underlying real estate. The value of securities of companies in the real estate
industry may go through cycles of relative under-performance and out-performance
in comparison to equity securities markets in general.

Various risks are also associated with certain of the investment practices
of the Funds. In particular, the use of leverage and short sales by the Funds
are speculative practices and may result in losses to the Funds. See "INVESTMENT
INSTRUMENTS AND PRACTICES--Short Sales and--Borrowing". Investments in foreign
securities, illiquid securities and Derivatives also involve various risks. See
"INVESTMENT INSTRUMENTS AND PRACTICES--Foreign Securities and--Illiquid
Securities" and "DERIVATIVE INVESTMENTS".

Prospective investors should consider the risks of a Fund's investment
program in determining whether to invest in the Fund.

MANAGEMENT OF THE FUNDS

As investment adviser to Funds, the Adviser manages the Funds' investments
and is responsible for providing the Funds with various administrative services.
As investment adviser to Alpine U.S. Real Estate Equity Fund, the Adviser is
entitled to receive from the Fund a monthly fee computed at the annual rates of
1% of the average daily net assets of the Fund on the first $750 million of
assets, 0.9% of average daily net assets on an annual basis on the next $250
million in assets, and 0.8% of average daily net assets on assets in excess of
$1 billion. As investment adviser to Alpine International Real Estate Equity
Fund, the Adviser is entitled to receive from the Fund a monthly fee computed at
the annual rate of 1% of the average daily net assets of the Fund on an annual
basis. The advisory fees paid by the Funds are higher than those paid by most
other investment companies, but are not higher than the fees paid by many funds
with similar investment objectives and policies. The total expenses of the Funds
as a percentage of average daily net assets on an annual basis of the Funds are
set forth in the section entitled "Financial Highlights".

The portfolio manager for the Funds is Samuel A. Lieber. Mr. Lieber has been
the principal portfolio manager of the Funds since their inception. Prior to the
organization of the Adviser, he was associated with Evergreen Asset Management
Corp. since 1985.

20
<PAGE>
PURCHASE AND REDEMPTION OF SHARES

HOW TO BUY SHARES

Investors may purchase Class Y Shares of the Funds at net asset value by
mail or wire as described below. The Funds impose no sales charges on Class Y
shares. Class Y shares are the only class of shares offered by this Prospectus.
The minimum initial investment is $1,000, which may be waived in certain
situations. There is no minimum for subsequent investments. Investors may make
subsequent investments by establishing a Systematic Investment Plan or a
Telephone Investment Plan. Shares will be issued at the net asset value per
share next computed after the receipt of a request to purchase shares, together
with payment in the amount of the purchase.

PURCHASES BY MAIL OR WIRE. Each investor must complete the Share Purchase
Application and mail it, together with a check made payable to the Fund whose
shares are being purchased, to State Street Bank and Trust Company ("State
Street") at P.O. Box 9021, Boston, Massachusetts 02205-9827. Checks not drawn on
U.S. banks will be subject to foreign collection which will delay an investor's
investment date and will be subject to processing fees.

When making subsequent investments, an investor should either enclose the
return remittance portion of the statement, or indicate on the face of the
check, the name of the Fund in which an investment is to be made, the exact
title of the account, the address, and the Fund account number. Purchase
requests should not be sent to a Fund in New York. If they are, the Fund must
forward them to State Street, and the request will not be effective until State
Street receives them.

Initial investments may also be made by wire by (i) calling State Street at
800-423-2615 for an account number and (ii) instructing your bank, which may
charge a fee, to wire federal funds to State Street, as follows: State Street
Bank and Trust Company, ABA No. 0110-0002-8, Attn: Custodian and Shareholder
Services. The wire must include references to the Fund in which an investment is
being made, account registration, and the account number. A complete Share
Purchase Application must also be sent to State Street indicating that the
shares have been purchased by wire, giving the date the wire was sent and
referencing the account number. Subsequent wire investments may be made by
existing shareholders by following the instructions outlined above. It is not
necessary, however, for existing shareholders to call for another account
number.

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

21
<PAGE>
HOW TO REDEEM SHARES

You may redeem shares of either Fund on any day the Exchange is open, either
directly or through your financial intermediary. The price you will receive is
the net asset value next computed after the Fund receives your redemption
request in proper form. Proceeds generally will be sent to you within seven
days. However, for shares recently purchased by check, a Fund will not send
proceeds until it is reasonably satisfied that the check has been collected
(which may take up to ten days). Once a redemption request has been telephoned
or mailed, it is irrevocable and may not be modified or canceled.

REDEEMING SHARES DIRECTLY BY MAIL OR TELEPHONE. Shares may be redeemed by
sending a signed letter of instruction or stock power form to State Street Bank
and Trust Company, P.O. Box 9021, Boston, Massachusetts 02205-9827, which is the
registrar, transfer agent and dividend-disbursing agent for each Fund. Stock
power forms are available from your financial intermediary, State Street, and
many commercial banks. Additional documentation is required for the sale of
shares by corporations, financial intermediaries, fiduciaries and surviving
joint owners. Signature guarantees are required for all redemption requests for
shares with a value of more than $50,000 or where the redemption proceeds are to
be mailed to an address other than that shown in the account registration. A
signature guarantee must be provided by a bank or trust company (not a Notary
Public), a member firm of a domestic stock exchange or by other financial
institutions whose guarantees are acceptable to State Street.

The telephone redemption service is not made available to shareholders
automatically. Shareholders wishing to use the telephone redemption service must
indicate this on the Share Purchase Application and choose how the redemption
proceeds are to be paid. Redemption proceeds will either (i) be mailed by check
to the shareholder at the address in which the account is registered or (ii) be
wired to an account with the same registration as the shareholder's account in a
Fund at a designated commercial bank. State Street currently deducts a $5 wire
charge from all redemption proceeds wired. This charge is subject to change
without notice. A shareholder who decides later to use this service, or to
change instructions already given, should fill out a Shareholder Services Form
and send it to State Street Bank and Trust Company, P.O. Box 9021, Boston,
Massachusetts 02205-9827, with such shareholder's signature guaranteed by a bank
or trust company (not a Notary Public), a member firm of a domestic stock
exchange or by other financial institutions whose guarantees are acceptable to
State Street. Shareholders should allow approximately ten days for such form to
be processed. The Funds will employ reasonable procedures to verify that
telephone requests are genuine. These procedures include requiring some form of
personal identification prior to acting upon instructions and tape recording of
conversations. If a Fund fails to follow such procedures, it may be liable for
any losses due to unauthorized or fraudulent instructions. The Fund shall not be
liable for following telephone instructions reasonably believed to be genuine.
Also, each Fund reserves the right to refuse a telephone redemption request, if
it is believed advisable to do so. Financial intermediaries may charge a fee for
handling telephonic requests. The telephone redemption option may be suspended
or terminated at any time without notice.

GENERAL. The redemption of shares is a taxable transaction for Federal
income tax purposes. Under unusual circumstances, a Fund may suspend redemptions
or postpone payment for up to seven days or

22
<PAGE>
longer, as permitted by Federal securities law. The Funds reserve the right to
close an account that as a result of one or more redemptions has remained below
$1,000 for thirty days. Shareholders will receive sixty days' written notice to
increase the account value before the account is closed. The Funds have elected
to be governed by Rule 18f-1 under the 1940 Act pursuant to which each Fund is
obligated to redeem shares solely in cash, up to the lesser of $250,000 or 1% of
a Fund's total net assets during any ninety day period for any one shareholder.
See the Statement of Additional Information for further details.

EXCHANGE PRIVILEGE

HOW TO EXCHANGE SHARES. You may exchange some or all of your Class Y Shares
of a Fund for shares of the same Class in the other Fund by telephone or mail as
described below. In addition, until April 3, 1998, you may exchange some or all
of your Class Y Shares for Class Y Shares in the Evergreen Keystone Funds. After
April 3, 1998, however, shares of the Funds will no longer be exchangeable into
or for shares of the Evergreen Keystone funds. Once an exchange request has been
telephoned or mailed, it is irrevocable and may not be modified or canceled.
Exchanges will be made on the basis of the relative net asset value of the
shares exchanged next determined after an exchange request is received. An
exchange which represents an initial investment in another mutual fund is
subject to the minimum investment and suitability requirements of each fund.

EXCHANGES BY TELEPHONE AND MAIL. You may exchange shares with a value of
$1,000 or more by telephone by calling the telephone number on the front of this
Prospectus. Exchange requests received after 4:00 p.m. (Eastern time) will be
processed using the net asset value determined on the next business day. During
periods of unusual economic or market changes, shareholders may experience
difficulty in effecting telephone exchanges. You should follow the procedures
outlined below for exchanges by mail if you are unable to reach State Street by
telephone. If you wish to use the telephone exchange service you should indicate
this on the Share Purchase Application. Each Fund will employ reasonable
procedures to confirm that instructions for the redemption or exchange of shares
communicated by telephone are genuine. A telephone exchange may be refused by a
Fund or State Street if it is believed advisable to do so. Procedures for
exchanging Fund shares by telephone may be modified or terminated at any time.
Written requests for exchanges should follow the same procedures outlined for
written redemption requests in the section entitled "How to Redeem Shares",
however, no signature guarantee is required.

SHAREHOLDER SERVICES

THE FUNDS OFFER THE FOLLOWING SHAREHOLDER SERVICES. For more information
about these services or your account, contact your financial intermediary, the
distributor of shares of the Funds, or the toll-free number on the front page of
this Prospectus. Some services are described in more detail in the Share
Purchase Application.

23
<PAGE>
TELEPHONE INVESTMENT PLAN. You may make investments into an existing account
electronically in amounts of not less than $100 or more than $10,000 per
investment. Telephone investment requests received by 3:00 p.m. (Eastern time)
will be credited to a shareholder's account the day the request is received.

Shares purchased under the Fund's Systematic Investment Plan or Telephone
Investment Plan may not be redeemed for ten days from the date of investment.

INVESTMENTS THROUGH EMPLOYEE BENEFIT AND SAVINGS PLANS. Certain qualified
and non-qualified benefit and savings plans may make shares of the Funds
available to their participants. The Adviser may provide compensation to
organizations providing administrative and recordkeeping services to plans which
make shares of the Funds available to their participants.

AUTOMATIC REINVESTMENT PLAN. For the convenience of investors, all dividends
and distributions are automatically reinvested in full and fractional shares of
a Fund at the net asset value per share at the close of business on the record
date, unless otherwise requested by a shareholder in writing. If the transfer
agent does not receive a written request for subsequent dividends and/or
distributions to be paid in cash at least three full business days prior to a
given record date, the dividends and/or distributions to be paid to a
shareholder will be reinvested. If you elect to receive dividends and
distributions in cash and the U.S. Postal Service cannot deliver the checks, or
if the checks remain uncashed for six months, the checks will be reinvested into
your account at the then current net asset value.

DIVIDENDS, DISTRIBUTIONS AND TAXES

24
<PAGE>
cash or in additional shares. Questions on how any distributions will be taxed
to the investor should be directed to the investor's own tax adviser.

Under current law, the highest Federal income tax rate applicable to net
long-term capital gains realized by individuals is 20% with respect to gain from
capital assets held more than eighteen months, and 28% with respect to gain from
capital assets held more than twelve months. The rate applicable to corporations
is 35%. Certain income from a Fund may qualify for a corporate
dividends-received deduction of 70%. Following the end of each calendar year,
every shareholder of the Fund will be sent applicable tax information and
information regarding the dividends and capital gain distributions made during
the calendar year. A Fund may be subject to foreign withholding taxes which
would reduce the yield on its investments. Tax treaties between certain
countries and the United States may reduce or eliminate such taxes. Shareholders
of a Fund who are subject to United States Federal income tax may be entitled,
subject to certain rules and limitations, to claim a Federal income tax credit
or deduction for foreign income taxes paid by a Fund. See the Statement of
Additional Information for additional details. A Fund's transactions in options,
futures and forward contracts may be subject to special tax rules. These rules
can affect the amount, timing and characteristics of distributions to
shareholders.

Each Fund is required by Federal law to withhold 31% of reportable payments
(which may include dividends, capital gain distributions and redemptions) paid
to certain shareholders. In order to avoid this backup withholding requirement,
you must certify on the Share Purchase Application, or on a separate form
supplied by State Street, that your social security or taxpayer identification
number is correct and that you are not currently subject to backup withholding
or are exempt from backup withholding. A shareholder who acquires Class A shares
of a Fund and sells or otherwise disposes of such shares within ninety days of
acquisition may not be allowed to include certain sales charges incurred in
acquiring such shares for purposes of calculating gain and loss realized upon a
sale or exchange of shares of the Fund.

GENERAL INFORMATION

25
<PAGE>
A shareholder in each Class of a Fund will be entitled to his or her share
of all dividends and distributions from a Fund's assets, based upon the relative
value of such shares to those of other Classes of the Fund, and, upon redeeming
shares, will receive the then current net asset value of the Class of shares of
the Fund represented by the redeemed shares less any applicable contingent
deferred sales charge. The Trust is empowered to establish, without shareholder
approval, additional investment series, which may have different investment
objectives, and additional classes of shares for any existing or future series.
If an additional series or class were established in a Fund, each share of the
series or class would normally be entitled to one vote for all purposes.
Generally, shares of each series and class would vote together as a single class
on matters, such as the election of Trustees, that affect each series and class
in substantially the same manner. Class A, Class B, Class C and Class Y shares
have identical voting, dividend, liquidation and other rights, except that each
class bears, to the extent applicable, its own distribution, shareholder service
and transfer agency expenses as well as any other expenses applicable only to a
specific Class. Each Class of shares votes separately with respect to Rule 12b-1
distribution plans and other matters for which separate class voting is
appropriate under applicable law. Shares are entitled to dividends as determined
by the Trustees and, in liquidation of a Fund, are entitled to receive the net
assets of the Fund.

CUSTODIAN, REGISTRAR, TRANSFER AGENT AND DIVIDEND-DISBURSING AGENT. State
Street Bank and Trust Company, P.O. Box 9021, Boston, Massachusetts 02205-9827
acts as each Fund's custodian, registrar, transfer agent and dividend-disbursing
agent. State Street is compensated for its services as transfer agent by a fee
based upon the number of shareholder accounts maintained for the Funds. The
transfer agency fee with respect to the Class B shares will be higher than the
transfer agency fee with respect to the Class A shares or Class C shares. First
Union National Bank, North Carolina ("FUNB") may act as sub-transfer agent in
connection with certain telephone services provided to the Funds' shareholders,
and with respect to shareholders participating in certain employee benefit plans
for which FUNB provides recordkeeping services.

PRINCIPAL UNDERWRITER. Evergreen Keystone Distributor, Inc., an affiliate of
BISYS Fund Services, located at 120 Clove Road, Little Falls, New Jersey 07424,
is the principal underwriter of the Funds. BISYS Fund Services provides certain
sub-administrative services to the Adviser in connection with its role as
investment adviser to Funds.

OTHER CLASSES OF SHARES. Each Fund currently offers four classes of shares,
Class A, Class B, Class C and Class Y, and may in the future offer additional
classes. Class Y shares are the only class of shares offered by this Prospectus.
The dividends payable with respect to Class A, Class B and Class C shares will
be less than those payable with respect to Class Y shares due to the
distribution and shareholder servicing related expenses borne by Class A, Class
B and Class C shares and the fact that such expenses are not borne by Class Y
shares.

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

26
<PAGE>
financial or business publications and periodicals, including model portfolios
or allocations, as they relate to fund management, investment philosophy, and
investment techniques.

CONTROL PERSONS. As of January 12, 1998, Stephen A. Lieber may be deemed to
control the Fund through his beneficial ownership of more than 25 percent of the
Fund's outstanding shares.

27
<PAGE>
INVESTMENT ADVISER

Alpine Management & Research, LLC, 2500 Westchester Avenue, Purchase, New York
10577

CUSTODIAN & TRANSFER AGENT

State Street Bank and Trust Company, Box 9021, Boston, Massachusetts 02205-9827

LEGAL COUNSEL

Schulte Roth & Zabel LLP, 900 Third Avenue, New York, New York 10022

INDEPENDENT AUDITORS

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

DISTRIBUTOR

Evergreen Keystone Distributor, Inc., 120 Clove Road, Little Falls, New Jersey
07424

28
<PAGE>

STATEMENT OF ADDITIONAL INFORMATION
February __, 1998

ALPINE EQUITY TRUST
2500 Westchester Avenue, Purchase, New York 10577
800-807-2940

Alpine U.S. Real Estate Equity Fund ("U.S. Fund")
Alpine International Real Estate Equity Fund ("International Fund")

This Statement of Additional Information pertains to all classes of shares
of the Alpine U.S. Real Estate Equity Fund and Alpine International Real Estate
Equity Fund (collectively, the "Funds"). The Funds are separate series of
Alpine Equity Trust (the "Trust"). Shares of the Funds are offered through two
separate Prospectuses: one offering Class A, Class B and Class C shares of the
Funds and a separate Prospectus offering Class Y shares of the Funds. Copies of
the Funds' Prospectuses may be obtained without charge by calling the number
listed above. This Statement of Additional Information is not a Prospectus. It
contains information in addition to and more detailed than that set forth in the
Prospectus and is intended to provide you with additional information regarding
the activities and operations of the Funds. This Statement of Additional
Information should be read in conjunction with the applicable Prospectus.

<PAGE>

TABLE OF CONTENTS

INVESTMENT OBJECTIVES AND POLICIES . . . . . . . . . . . . . . . . . . 3

SPECIAL INVESTMENT TECHNIQUES . . . . . . . . . . . . . . . . . . . . 12

INVESTMENT RESTRICTIONS. . . . . . . . . . . . . . . . . . . . . . . . 15

CERTAIN RISK CONSIDERATIONS. . . . . . . . . . . . . . . . . . . . . . 19

MANAGEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20

TRUSTEES COMPENSATION TABLE. . . . . . . . . . . . . . . . . . . . . . 21

INVESTMENT ADVISER . . . . . . . . . . . . . . . . . . . . . . . . . . 25

DISTRIBUTION PLANS . . . . . . . . . . . . . . . . . . . . . . . . . . 28

ALLOCATION OF BROKERAGE. . . . . . . . . . . . . . . . . . . . . . . . 30

ADDITIONAL TAX INFORMATION . . . . . . . . . . . . . . . . . . . . . . 32

NET ASSET VALUE. . . . . . . . . . . . . . . . . . . . . . . . . . . . 35

PURCHASE OF SHARES . . . . . . . . . . . . . . . . . . . . . . . . . . 36

GENERAL INFORMATION ABOUT THE FUNDS. . . . . . . . . . . . . . . . . . 46

PERFORMANCE INFORMATION. . . . . . . . . . . . . . . . . . . . . . . . 48

FINANCIAL STATEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . 50

APPENDIX "A" DESCRIPTION OF BOND RATINGS . . . . . . . . . . . . . . . 51

APPENDIX "B" FUTURES AND OPTIONS . . . . . . . . . . . . . . . . . . . 57

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INVESTMENT OBJECTIVES AND POLICIES

(See also "DESCRIPTION OF THE FUNDS - Investment Objectives and
Policies" in the Funds' Prospectus)

The investment objective of each Fund and a description of the
investment policies and practices of each Fund is set forth under "DESCRIPTION
OF THE FUNDS--Investment Objectives and Policies" in the Prospectus. Each
Fund's investment objective is fundamental and may not be changed without the
approval of a majority of the outstanding voting securities of the Fund.

Alpine Management & Research, LLC (the "Adviser") serves as the
investment adviser of each Fund.

TYPES OF INVESTMENTS

Convertible Securities

Each Fund may invest in convertible securities. Convertible
securities include fixed-income securities that may be exchanged or converted
into a predetermined number of shares of the issuer's underlying common stock at
the option of the holder during a specified period. Convertible securities may
take the form of convertible preferred stock, convertible bonds or debentures,
units consisting of "usable" bonds and warrants or a combination of the features
of several of these securities. The investment characteristics of each
convertible security vary widely, which allow convertible securities to be
employed for a variety of investment strategies.

Each Fund will exchange or convert convertible securities into shares
of underlying common stock when, in the opinion of the Adviser, the investment
characteristics of the underlying common shares will assist a Fund in achieving
its investment objective. A Fund may also elect to hold or trade convertible
securities. In selecting convertible securities, the Adviser evaluates the
investment characteristics of the convertible security as a fixed-income
instrument, and the investment potential of the underlying equity security for
capital appreciation. In evaluating these matters with respect to a particular
convertible security, the Adviser considers numerous factors, including the
economic and political outlook, the value of the security relative to other
investment alternatives, trends in the determinants of the issuer's profits, and
the issuer's management capability and practices.

Warrants

Each Fund may invest in warrants. Warrants are options to purchase
common stock at a specific price (usually at a premium above the market value of
the optioned common stock at issuance) valid for a specific period of time.
Warrants may have a life ranging from less than one year to twenty years, or
they may be perpetual. However, most warrants have expiration dates after which
they are worthless. In addition, a warrant is worthless if the market price of
the common stock does not exceed the warrant's exercise price during the life of
the

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<PAGE>

warrant. Warrants have no voting rights, pay no dividends, and have no rights
with respect to the assets of the corporation issuing them. The percentage
increase or decrease in the market price of the warrant may tend to be greater
than the percentage increase or decrease in the market price of the optioned
common stock.

Foreign Securities

Each Fund may purchase securities of non-U.S. issues and other
securities that trade in foreign markets ("foreign securities"). To the extent
that foreign securities purchased by the Funds are denominated in currencies
other than the U.S. dollar, changes in foreign currency exchange rates will
affect the Funds' net asset values per share; the value of any interest earned;
gains and losses realized on the sale of securities; and net investment income
and capital gains, if any, to be distributed to shareholders by a Fund. If the
value of a foreign currency rises against the U.S. dollar, the value of a Fund's
assets denominated in that currency will increase. Correspondingly, if the value
of a foreign currency declines against the U.S. dollar, the value of a Fund's
assets denominated in that currency will decrease. The performance of the Funds
will be measured in U.S. dollars, the base currency for the Funds. When a Fund
converts its holdings to another currency, it may incur conversion costs.
Foreign exchange dealers realize a profit on the difference between the prices
at which such dealers buy and sell currencies.

The Funds may engage in transactions in foreign securities which are
listed on foreign securities exchanges, traded in the over-the-counter market or
issued in private placements. Transactions in listed securities may be effected
in the over-the-counter markets if, in the opinion of the Adviser, this affords
the Funds the ability to obtain best price and execution. Securities markets of
foreign countries in which the Funds may invest are generally not subject to the
same degree of regulation as the U.S. markets and may be more volatile and less
liquid than the major U.S. markets. The differences between investing in
foreign and U.S. companies include: (1) less publicly available information
about foreign companies; (2) the lack of uniform financial accounting standards
and practices among countries which could impair the validity of direct
comparisons of valuations measures (such as price/earnings ratios) for
securities in different countries; (3) less readily available market quotations
for the securities of foreign issuers; (4) differences in government regulation
and supervision of foreign stock exchanges, brokers, listed companies, and
banks; (5) differences in legal systems which may affect the ability to enforce
contractual obligations or obtain court judgments; (6) generally lower foreign
stock market volume; (7) the likelihood that foreign securities may be less
liquid or more volatile, which may affect the ability of the Funds to purchase
or sell large blocks of securities and thus obtain the best price; (8)
transactions costs, including brokerage charges and custodian charges associated
with holding foreign securities, may be higher; (9) the settlement period for
foreign securities, which are sometimes longer than those for securities of U.S.
issuers, may affect portfolio liquidity; (10) foreign securities held by a Fund
may be traded on days that the Fund does not value its portfolio securities,
such as Saturdays and customary business holidays, and accordingly, net asset
value per share may be significantly affected on days when shareholders do not
have the ability to purchase or redeem shares of the Fund; and (11) political
and social instability, expropriation, and political or financial changes which
adversely affect investment in some countries. These various risks may be
greater in emerging market countries.

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<PAGE>

American Depositary Receipts ("ADRs") and European Depositary Receipts
("EDRs") and other securities convertible into securities of foreign issuers may
not necessarily be denominated in the same currency as the securities into which
they may be converted, but rather in the currency of the market in which they
are traded. ADRs are receipts typically issued by an American bank or trust
company which evidence ownership of underlying securities issued by a foreign
corporation. EDRs are receipts issued in Europe by banks or depositories which
evidence a similar ownership arrangement. Generally ADRs, in registered form,
are designed for use in United States securities markets and EDRs, in bearer
form, are designed for use in European securities markets.

Sovereign Debt Obligations

Each Fund may purchase sovereign debt instruments issued or guaranteed
by foreign governments or their agencies, including debt of Latin American
nations or other developing countries. Sovereign debt may be in the form of
conventional securities or other types of debt instruments such as loans or loan
participations. Sovereign debt of developing countries may involve a high
degree of risk, and may be in default or present the risk of default.
Governmental entities responsible for repayment of the debt may be unable or
unwilling to repay principal and interest when due, and may require
renegotiation or rescheduling of debt payments. In addition, prospects for
repayment of principal and interest may depend on political as well as economic
factors.

Shares of Closed-End Investment Companies and Money Market Funds

Each Fund may purchase the equity securities of closed-end investment
companies to facilitate investment in certain countries. Equity securities of
closed-end investment companies generally trade at a discount to their net asset
value, but may also trade at a premium to net asset value. The Funds may pay a
premium to invest in a closed-end investment company in circumstances where the
Adviser determines that the potential for capital growth justifies the payment
of a premium. Closed-end investment companies, as well as money market funds,
pay investment advisory and other fees and incur various expenses in connection
with their operations. Shareholders of the Funds will indirectly bear these
fees and expenses, which will be in addition to the fees and expenses of the
Funds.

Mortgage-Backed Securities

Each Fund may invest in mortgage-backed securities issued or
guaranteed by the U.S. Government, or one of its agencies or instrumentalities,
or issued by private issuers. The mortgage-backed securities in which the Funds
may invest include collateralized mortgage obligations ("CMOs") and REMICs.
CMOs are debt instruments issued by special purpose entities and secured by
mortgages or other mortgage-backed securities, which provide by their terms for
aggregate payments of principal and interest based on the payments made on the
underlying mortgages or securities. CMOs are typically issued in separate
classes with varying coupons and stated maturities. REMICs are mortgage-backed
securities as to which the issuers have qualified to be treated as real estate
mortgage investment conduits under the Internal Revenue Code of 1986 and have
the same characteristics as CMOs. As a result of current

5
<PAGE>

interpretations of the Staff of the Securities and Exchange Commission (the
"SEC"), the amount of privately issued mortgage-backed securities that may be
purchased by a Fund may not exceed 10% of the value of the Fund's total assets,
and the securities of any one such issuer purchased by a Fund may not exceed 5%
of the value of the Fund's total assets.

Each Fund may from time to time also invest in "stripped"
mortgage-backed securities. These are securities which operate like CMOs but
entitle the holder to disproportionate interests with respect to the allocation
of interest or principal on the underlying mortgages or securities. A stripped
mortgage-backed security is created by the issuer separating the interest and
principal on a mortgage pool to form two or more independently tradable
securities. The result is the creation of classes of discount securities which
can be structured to produce faster or slower prepayment expectations based upon
the particular underlying mortgage interest rate payments assigned to each
class. These obligations exhibit risk characteristics similar to
mortgage-backed securities generally and zero coupon securities. Due to
existing market characteristics, "interest only" and "principal only"
mortgage-backed securities are considered to be illiquid.

Because the mortgages underlying mortgage-backed securities are
subject to prepayment at any time, most mortgage-backed securities are subject
to the risk of prepayment in an amount differing from that anticipated at the
time of issuance. Prepayments generally are passed through to the holders of
the securities. Any such prepayments received by a Fund must be reinvested in
other securities. As a result, prepayments in excess of that anticipated could
adversely affect yield to the extent reinvested in instruments with a lower
interest rate than that of the original security. Prepayments on a pool of
mortgages are influenced by a variety of economic, geographic, social and other
factors. Generally, however, prepayments will increase during a period of
falling interest rates and decrease during a period of rising interests rates.
Accordingly, amounts required to be reinvested are likely to be greater (and the
potential for capital appreciation less) during a period of declining interest
rates than during a period or rising interest rates. Mortgage-backed securities
may be purchased at a premium over the principal or face value in order to
obtain higher income. The recovery of any premium that may have been paid for a
given security is solely a function of the ability to liquidate such security at
or above the purchase price.

Asset-Backed Securities

Each Fund may invest in asset-backed securities issued by private
issuers. Asset-backed securities represent interests in pools of consumer loans
(generally unrelated to mortgage loans) and most often are structured as
pass-through securities. Interest and principal payments ultimately depend on
payment of the underlying loans by individuals, although the securities may be
supported by letters of credit or other credit enhancements. The value of
asset-backed securities may also depend on the creditworthiness of the servicing
agent for the loan pool, the originator of the loans, or the financial
institution providing the credit enhancement. Asset-backed securities may be
"stripped" into classes in a manner similar to that described under the
"Mortgage-Backed Securities", above, and are subject to the prepayment risks
described therein.

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<PAGE>

Strategic Investments

Foreign Currency Transactions; Currency Risks

Exchange rates between the U.S. dollar and foreign currencies are a
function of such factors as supply and demand in the currency exchange markets,
international balances of payments, governmental intervention, speculation and
other economic and political conditions. Although a Fund values its assets
daily in U.S. dollars, a Fund generally does not convert its holdings to U.S.
dollars or any other currency. Foreign exchange dealers may realize a profit on
the difference between the price at which a Fund buys and sells currencies.

Each Fund will engage in foreign currency exchange transactions in
connection with its portfolio investments. A Fund will conduct its foreign
currency exchange transactions either on a spot (i.e., cash) basis at the spot
rate prevailing in the foreign currency exchange market or through forward
contracts to purchase or sell foreign currencies.

Forward Foreign Currency Exchange Contracts

Each Fund may enter into forward foreign currency exchange contracts
in order to protect against a possible loss on a foreign investment resulting
from an adverse change in the relationship between the U.S. dollar and the
foreign currency involved in an underlying transaction. A forward foreign
currency exchange contract involves an obligation to purchase or sell a specific
currency at a future date, which may be any fixed number of days (usually less
than one year) from the date of the contract agreed upon by the parties, at a
price set at the time of the contract. These contracts are traded in the
interbank market conducted directly between currency traders (usually large
commercial banks) and their customers. A forward contract generally has a
deposit requirement, and no commissions are charged at any stage for trades.
Although foreign exchange dealers do not charge a fee for conversion, they do
realize a profit based on the difference (the spread) between the price at which
they are buying and selling various currencies. However, forward foreign
currency exchange contracts may limit potential gains which could result from a
positive change in such currency relationships. The Adviser believes that it is
important to have the flexibility to enter into forward foreign currency
exchange contracts whenever it determines that it is in a Fund's best interest
to do so. The Funds will not speculate in foreign currency exchange.

Except for cross-hedges, a Fund will not enter into forward foreign
currency exchange contracts or maintain a net exposure in such contracts when it
would be obligated to deliver an amount of foreign currency in excess of the
value of its portfolio securities or other assets denominated in that currency
or, in the case of a "cross-hedge" denominated in a currency or currencies that
the Adviser believes will tend to be closely correlated with that currency with
regard to price movements. At the consummation of such a forward contract, a
Fund may either make delivery of the foreign currency or terminate its
contractual obligation to deliver the foreign currency by purchasing an
offsetting contract obligating it to purchase, at the same maturity date, the
same amount of such foreign currency. If a Fund chooses to make delivery of the
foreign currency, it may be required to obtain such currency through the sale of
portfolio securities denominated in such currency or through conversion of other
assets of the Fund into

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<PAGE>

such currency. If a Fund engages in an offsetting transaction, the Fund will
incur a gain or loss to the extent that there has been a change in forward
contract prices.

It should be realized that this method of protecting the value of a
Fund's portfolio securities against a decline in the value of a currency does
not eliminate fluctuations in the underlying prices of the securities. It
simply establishes a rate of exchange which can be achieved at some future point
in time. Additionally, although such contracts tend to minimize the risk of
loss due to a decline in the value of the hedged currency, at the same time they
tend to limit any potential gain which might result should the value of such
currency increase. Generally, a Fund will not enter into a forward foreign
currency exchange contract with a term longer than one year.

Foreign Currency Options

A foreign currency option provides the option buyer with the right to
buy or sell a stated amount of foreign currency at the exercise price on a
specified date or during the option period. The owner of a call option has the
right, but not the obligation, to buy the currency. Conversely, the owner of a
put option has the right, but not the obligation, to sell the currency. When
the option is exercised, the seller (i.e., writer) of the option is obligated to
fulfill the terms of the sold option. However, either the seller or the buyer
may, in the secondary market, close its position during the option period at any
time prior to expiration.

A call option on a foreign currency generally rises in value if the
underlying currency appreciates in value, and a put option on a foreign currency
generally rises in value if the underlying currency depreciates in value.
Although purchasing a foreign currency option can protect the Fund against an
adverse movement in the value of a foreign currency, the option will not limit
the movement in the value of such currency. For example, if a Fund was holding
securities denominated in a foreign currency that was appreciating and had
purchased a foreign currency put to hedge against a decline in the value of the
currency, the Fund would not have to exercise its put option. Likewise, if a
Fund were to enter into a contract to purchase a security denominated in foreign
currency and, in conjunction with that purchase, were to purchase a foreign
currency call option to hedge against a rise in value of the currency, and if
the value of the currency instead depreciated between the date of purchase and
the settlement date, the Fund would not have to exercise its call. Instead, the
Fund could acquire in the spot market the amount of foreign currency needed for
settlement.

Special Risks Associated with Foreign Currency Options

Buyers and sellers of foreign currency options are subject to the same
risks that apply to options generally. In addition, there are certain
additional risks associated with foreign currency options. The markets in
foreign currency options are relatively new, and a Fund's ability to establish
and close out positions on such options is subject to the maintenance of a
liquid secondary market. Although the Funds will not purchase or write such
options unless and until, in the opinion of the investment adviser, the market
for them has developed sufficiently to ensure that the risks in connection with
such options are not greater than the risks in connection with the underlying
currency, there can be no assurance that a liquid secondary market will exist

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<PAGE>

for a particular option at any specific time. In addition, options on foreign
currencies are affected by most of the same factors that influence foreign
exchange rates and investments generally.

The value of a foreign currency option depends upon the value of the
underlying currency relative to the U.S. dollar. As a result, the price of the
option position may vary with changes in the value of either or both currencies
and may have no relationship to the investment merits of a foreign security.
Because foreign currency transactions occurring in the interbank market involve
substantially larger amounts than those that may be involved in the use of
foreign currency options, investors may be disadvantaged by having to deal in an
odd lot market (generally consisting of transactions of less than $1 million)
for the underlying foreign currencies at prices that are less favorable than for
round lots.

There is no systematic reporting of last sale information for foreign
currencies or any regulatory requirement that quotations available through
dealers or other market sources be firm or revised on a timely basis. Available
quotation information is generally representative of very large transactions in
the interbank market and thus may not reflect relatively smaller transactions
(i.e., less than $1 million) where rates may be less favorable. The interbank
market in foreign currencies is a global, around-the-clock market. To the
extent that the U.S. option markets are closed while the markets for the
underlying currencies remain open, significant price and rate movements may take
place in the underlying markets that cannot be reflected in the options markets
until they reopen.

Foreign Currency Futures Transactions

By using foreign currency futures contracts and options on such
contracts, a Fund may be able to achieve many of the same objectives as it would
through the use of forward foreign currency exchange contracts. The Funds may
be able to achieve these objectives possibly more effectively and at a lower
cost by using futures transactions instead of forward foreign currency exchange
contracts.

A foreign currency futures contract sale creates an obligation by a
Fund, as seller, to deliver the amount of currency called for in the contract at
a specified future time for a specified price. A currency futures contract
purchase creates an obligation by a Fund, as purchaser, to take delivery of an
amount of currency at a specified future time at a specified price. Although
the terms of currency futures contracts specify actual delivery or receipt, in
most instances the contracts are closed out before the settlement date without
the making or taking of delivery of the currency. Closing out of currency
futures contracts is effected by entering into an offsetting purchase or sale
transaction. An offsetting transaction for a currency futures contract sale is
effected by the Fund entering into a currency futures contract purchase for the
same aggregate amount of currency and same delivery date. If the price of the
sale exceeds the price of the offsetting purchase, the Fund is immediately paid
the difference and realizes a loss. Similarly, the closing out of a currency
futures contract purchase is effected by the Fund entering into a currency
futures contract sale. If the offsetting sale price exceeds the purchase price,
the Fund realizes a gain, and if the offsetting sale price is less than the
purchase price, the Fund realizes a loss.

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<PAGE>

Special Risks Associated with Foreign Currency Futures Contracts and Related
Options

Buyers and sellers of foreign currency futures contracts are subject
to the same risks that apply to the use of futures generally. In addition,
there are risks associated with foreign currency futures contracts and their use
as a hedging device similar to those associated with options on foreign
currencies, as described above.

Options on foreign currency futures contracts may involve certain
additional risks. Trading options on foreign currency futures contracts is
relatively new. The ability to establish and close out positions on such
options is subject to the maintenance of a liquid secondary market. To reduce
this risk, the Funds will not purchase or write options on foreign currency
futures contracts unless and until, in the opinion of the Adviser, the market
for such options has developed sufficiently that the risks in connection with
such options are not greater than the risks in connection with transactions in
the underlying foreign currency futures contracts. Compared to the purchase or
sale of foreign currency futures contracts, the purchase of call or put options
on futures contracts involves less potential risk to the Funds because the
maximum amount at risk is the premium paid for the option (plus transaction
costs). However, there may be circumstances when the purchase of a call or put
option on a futures contract would result in a loss, such as when there is no
movement in the price of the underlying currency or futures contract.

Illiquid Securities

The ability of the Trust's Board of Trustees ("Trustees") to determine
the liquidity of certain restricted securities is permitted under an SEC Staff
position set forth in the adopting release for Rule 144A (the "Rule") under the
Securities Act of 1933 (the "1933 Act"). The Rule is a non-exclusive,
safe-harbor for certain secondary market transactions involving securities
subject to restrictions on resale under federal securities laws. The Rule
provides an exemption from registration for resales of otherwise restricted
securities to qualified institutional buyers. The Rule was expected to further
enhance the liquidity of the secondary market for securities eligible for sale
under the Rule. The Staff of the SEC has left the question of determining the
liquidity of all restricted securities (eligible for resale under the Rule) for
determination by the Trustees. The Trustees consider the following criteria in
determining the liquidity of certain restricted securities:

(i) the frequency of trades and quotes for the security;

(ii) the number of dealers willing to purchase or sell the
security and the number of other potential buyers;

(iii) dealer undertakings to make a market in the security; and

(iv) the nature of the security and the nature of the
marketplace trades.

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<PAGE>

When-Issued and Delayed Delivery Securities

These transactions are made to secure what is considered to be an
advantageous price or yield for a Fund. No fees or other expenses, other than
normal transaction costs, are incurred. However, liquid assets of a Fund
sufficient to make payment for the securities to be purchased are segregated on
the Fund's records at the trade date. These assets are marked to market and are
maintained until the transaction has been settled.

Lending of Portfolio Securities

The collateral received when a Fund lends portfolio securities must be
valued daily and, should the market value of the loaned securities increase, the
borrower must furnish additional collateral to the lending Fund. During the
time portfolio securities are on loan, the borrower pays the Fund any dividends
or interest paid on such securities. Loans are subject to termination at the
option of the Fund or the borrower. A Fund may pay reasonable administrative
and custodial fees in connection with a loan and may pay a negotiated portion of
the interest earned on the cash or equivalent collateral to the borrower or
placing broker. A Fund does not have the right to vote securities on loan, but
would terminate the loan and regain the right to vote if that were considered
important with respect to the investment.

Repurchase Agreements

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

Reverse Repurchase Agreements

The Funds may also enter into reverse repurchase agreements. These
transactions are similar to borrowing cash. In a reverse repurchase agreement,
a Fund transfers possession of a portfolio instrument to another person, such as
a financial institution, broker, or dealer, in return for a percentage of the
instrument's market value in cash, and agrees that on a stipulated date in the
future the Fund will repurchase the portfolio instrument by remitting the
original consideration plus interest at an agreed upon rate. The use of reverse
repurchase agreements may enable a Fund to avoid selling portfolio instruments
at a time when a sale may be deemed to be disadvantageous, but the ability to
enter into reverse repurchase agreements does not ensure that the Fund will be
able to avoid selling portfolio instruments at a disadvantageous time.

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<PAGE>

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

Short Sales

As discussed in the Funds' Prospectuses, each Fund may engage in short
sales. A Fund sells a security short when the Adviser believes the price of the
security will decline. A Fund also may sell a security short to protect against
a decline in the price of a security it already owns, but wishes to defer the
realization of a capital loss. To sell a security short, a Fund must borrow the
security. A Fund's obligation to replace the security borrowed and sold short
will be fully secured at all times by cash or liquid portfolio securities
deposited in a segregated account. The use of short sales is considered a
speculative investment practice.

Borrowing

Each Fund may borrow money for investment purposes (which is a
practice known as "leverage"). Leveraging creates an opportunity for increased
net income, but at the same time, creates special risk considerations. For
example, leveraging may exaggerate changes in the net asset value of a Fund's
shares and in the yield on a Fund's portfolio. Although the principal of such
borrowings will be fixed, a Fund's net assets may change in value during the
time the borrowing is outstanding. Since any decline in value of a Fund's
investments will be borne entirely by the Fund's shareholders, the effect of
leverage in a declining market would be a greater decrease in net asset value
than if the Fund were not so leveraged. Leveraging will create interest
expenses for a Fund, which can exceed the investment return from the borrowed
funds. To the extent the investment return derived from securities purchased
with borrower funds exceeds the interest a Fund will have to pay, the Fund's
investment return will be greater than if leveraging were not used. Conversely,
if the investment return from the assets retained with borrowed funds is not
sufficient to cover the cost of leveraging, the investment return of the Fund
will be less than if leveraging were not used.

SPECIAL INVESTMENT TECHNIQUES

As discussed in the Funds' Prospectuses, each Fund may engage in
certain transactions in options and futures contracts and options on futures
contracts. The specific transactions in which each Fund may engage are noted
and described in the Prospectuses. The discussion below provides additional
information regarding the use of options on stock indices and stock index
futures. Appendix B to this Statement of Additional Information sets forth
further details regarding options and futures.

Regulatory Matters

The Funds will comply with and adhere to all limitations on the manner
and extent to which they effect transactions in futures and options on such
futures currently imposed by the rules and policy guidelines of the Commodity
Futures Trading Commission as conditions

12
<PAGE>

for exemption of a mutual fund, or investment advisers thereto, from
registration as a commodity pool operator. Under those restrictions, the Funds
will not, as to any positions, whether long, short or a combination thereof,
enter into futures and options thereon for which the aggregate initial margins
and premiums exceed 5% of the fair market value of its assets after taking into
account unrealized profits and losses on options it has entered into. In the
case of an option that is "in-the-money", the in-the-money amount may be
excluded in computing such 5%. (In general, a call option on a future is
"in-the-money" if the value of the future exceeds the exercise ("strike") price
of the call; a put option on a future is "in-the-money" if the value of the
future which is the subject of the put is exceeded by the strike price of the
put.) The Funds may use futures and options thereon solely for bona fide
hedging or for other non-speculative purposes within the meaning and intent of
the applicable provisions of the Commodities Exchange Act and regulations
thereunder. As to long positions which are used as part of a Fund's investment
strategy and are incidental to its activities in the underlying cash market, the
"underlying commodity value" of the Fund's futures and options thereon must not
exceed the sum of (i) cash set aside in an identifiable manner, or short-term
U.S. debt obligations or other dollar-denominated high-quality, short-term money
instruments so set aside, plus sums deposited on margin; (ii) cash proceeds from
existing investments due in 30 days; and (iii) accrued profits held at the
futures commission merchant. The "underlying commodity value" of a future is
computed by multiplying the size of the future by the daily settlement price of
the future. For an option on a future, that value is the underlying commodity
value of the future underlying the option.

Risks of Options on Stock Indices

As discussed in the Prospectuses, the purchase and sale of options on
stock indices will be subject to risks applicable to options transactions
generally. In addition, the distinctive characteristics of options on indices
create certain risks that are not present with stock options. Index prices may
be distorted if trading of certain stocks included in the index is interrupted.
Trading in index options also may be interrupted in certain circumstances such
as if trading were halted in a substantial number of stocks included in the
index or if dissemination of the current level of an underlying index is
interrupted. If this occurred, a Fund would not be able to close out options
which it had purchased and, if restrictions on exercise were imposed, may be
unable to exercise an option it holds, which could result in losses if the
underlying index moves adversely before trading resumes. However, it is a
policy to purchase options only on indices which include a sufficient number of
stocks so that the likelihood of a trading halt in the index is minimized.

The purchaser of an index option may also be subject to a timing risk.
If an option is exercised by a Fund before final determination of the closing
index value for that day, the risk exists that the level of the underlying index
may subsequently change. If such a change caused the exercised option to fall
out-of-the-money (that is, the exercising of the option would result in a loss,
not a gain), the Fund would be required to pay the difference between the
closing index value and the exercise price of the option (times the applicable
multiplier) to the assigned writer. Although the Fund may be able to minimize
this risk by withholding exercise instructions until just before the daily
cutoff time, it may not be possible to eliminate this risk entirely because the
exercise cutoff times for index options may be earlier than those fixed for

13
<PAGE>

other types of options and may occur before definitive closing index values are
announced. Alternatively, when the index level is close to the exercise price,
a Fund may sell rather than exercise the option. Although the markets for
certain index option contracts have developed rapidly, the markets for other
index options are not as liquid. The ability to establish and close out
positions on such options will be subject to the development and maintenance of
a liquid secondary market. It is not certain that this market will develop in
all index option contracts. The Funds will not purchase or sell any index
option contract unless and until in the opinion of the Adviser the market for
such options has developed sufficiently that such risk in connection with such
transactions is no greater than such risk in connection with options on stocks.

Stock Index Futures Characteristics

Currently, stock index futures contracts can be purchased or sold with
respect to several different stock indices, each based on a different measure of
market performance. A determination as to which of the index contracts would be
appropriate for purchase or sale by the Funds will be based upon, among other
things, the liquidity offered by such contracts and the volatility of the
underlying index.

Unlike when the Funds purchase or sell a security, no price is paid or
received by the Funds upon the purchase or sale of a futures contract. Instead,
the Funds will be required to deposit in a segregated asset account an amount of
cash or qualifying securities (currently U.S. Treasury bills) currently ranging
from approximately 10% to 15% of the contract amount. This is called "initial
margin". Such initial margin is in the nature of a performance bond or good
faith deposit on the contract which is returned to the Funds upon termination of
the futures contract. Gains and losses on open contracts are required to be
reflected in cash in the form of variation margin payments which the Funds may
be required to make during the term of the contracts to their broker. Such
payments would be required where, during the term of a stock index futures
contract purchased by the Funds, the price of the underlying stock index
declined, thereby making the Funds' position less valuable. In all instances
involving the purchase of stock index futures contracts by the Funds, an amount
of cash together with such other securities as permitted by applicable
regulatory authorities to be utilized for such purpose, at least equal to the
market value of the futures contracts, will be deposited in a segregated account
with the Funds' custodian to collateralize the position. At any time prior to
the expiration of a futures contract, the Funds may elect to close their
position by taking an opposite position which will operate to terminate their
position in the futures contract. For a more complete discussion of the risks
involved in stock index futures, refer to the Appendix ("Futures and Options").

Where futures are purchased to hedge against a possible increase in
the price of a security before the Funds are able to fashion their program to
invest in the security or in options on the security, it is possible that the
market may decline instead. If the Funds, as a result, concluded not to make
the planned investment at that time because of concern as to the possible
further market decline or for other reasons, the Funds would realize a loss on
the futures contract that is not offset by a reduction in the price of
securities purchased.

14
<PAGE>

In addition to the possibility that there may be an imperfect
correlation or no correlation at all between movements in the stock index future
and the portion of the portfolio being hedged, the price of stock index futures
may not correlate perfectly with movements in the stock index due to certain
market distortions. All participants in the futures market are subject to
margin deposit and maintenance requirements. Rather than meeting additional
margin deposit requirements, investors may close futures contracts through
offsetting transactions which could distort the normal relationship between the
index itself and the value of a future. Moreover, the deposit requirements in
the futures market are less onerous than margin requirements in the securities
market and may therefore cause increased participation by speculators in the
futures market. Such increased participation may also cause temporary price
distortions. Due to the possibility of price distortion in the futures market
and because of the imperfect correlation between movements in stock indices and
movements in the prices of stock index futures, the value of stock index futures
contracts as a hedging device may be reduced. In addition, if the Funds have
insufficient available cash, they may at times have to sell securities to meet
variation margin requirements. Such sales may have to be effected at a time
when it may be disadvantageous to do so.

INVESTMENT RESTRICTIONS

FUNDAMENTAL INVESTMENT RESTRICTIONS

Except as noted, the investment restrictions set forth below are
fundamental and may not be changed with respect to a Fund without the
affirmative vote of a majority of the outstanding voting securities of that
Fund. Where an asterisk (*) appears, the relevant policy is non-fundamental
with respect to that Fund and may be changed by the Trustees without shareholder
approval. As used in this Statement of Additional Information and in the
Prospectus, "a majority of the outstanding voting securities of a Fund" means
the lesser of (1) the holders of more than 50% of the outstanding shares of
beneficial interest of the Fund or (2) 67% of the shares of the Fund present if
more than 50% of the shares are present at a meeting in person or by proxy.

1. Diversification

U.S. FUND

The Fund may not invest more than 5% of its total assets, at the time
of the investment in question, in the securities of any one issuer other than
the U.S. government and its agencies or instrumentalities, except that up to 25%
of the value of its total assets may be invested without regard to such 5%
limitation.

In addition, the U.S. Fund may not purchase more than 10% of any class
of securities of any one issuer other than the U.S. government and its agencies
or instrumentalities.*

INTERNATIONAL FUND

15
<PAGE>

With respect to 75% of its total assets, the Fund may not purchase a
security, other than securities issued or guaranteed by the U.S. government, its
agencies or instrumentalities, if as a result of such purchase, more than 5% of
the value of the Fund's total assets would be invested in the securities of any
one issuer, or the Fund would own more than 10% of the voting securities of any
one issuer.

2. Investment for Purposes of Control or Management

The U.S. Fund* and the International Fund may not invest in companies
for the purpose of exercising control or management.

3. Purchase of Securities on Margin

The U.S. Fund* and the International Fund may not purchase securities
on margin, except that each Fund may obtain such short-term credits as may be
necessary for the clearance of transactions. A deposit or payment by a Fund of
initial or variation margin in connection with financial futures contracts or
related options transactions is not considered the purchase of a security on
margin.

4. Underwriting

U.S. FUND

The U.S. Fund may not engage in the business of underwriting
securities of other issuers.

INTERNATIONAL FUND

The International Fund will not underwrite any issue of securities
except as it may be deemed an underwriter under the 1933 Act in connection with
the sale of securities in accordance with its investment objectives, policies
and limitations.

5. Interests in Oil, Gas or Other Mineral Exploration or Development
Programs

Neither Fund may purchase, sell or invest in interests in oil, gas or
other mineral exploration or development programs.

6. Concentration in Any One Industry

Each Fund will concentrate its investments in the securities of
companies engaged principally in the real estate industry and may invest all of
its assets in such securities; however, each Fund may temporarily invest less
than 25% of the value of its assets in such securities during periods of adverse
economic conditions in the real estate industry.

7. Short Sales

16
<PAGE>

Each Fund may effect short sales of securities subject to the
limitation that a Fund may not sell a security short if, as a result of such
sale, the current value of securities sold short by the Fund would exceed 10% of
the value of the Fund's net assets; provided, however, if the Fund owns or has
the right to obtain securities equivalent in kind and amount to the securities
sold short (I.E., short sales "against the box"), this limitation is not
applicable.

8. Lending of Funds and Securities

The Funds may not make loans of money or securities, except to the
extent that the Funds may lend money through the purchase of permitted
investments, including repurchase agreements, and may lend securities in
accordance with such procedures as may be adopted by the Trustees.

Neither Fund may lend its portfolio securities, unless the borrower is
a broker-dealer or financial institution that pledges and maintains collateral
with the Fund consisting of cash or securities issued or guaranteed by the U.S.
government having a value at all times not less than 100% of the current
market-value of the loaned securities, including accrued interest, provided that
the aggregate amount of such loans shall not exceed 30% of the Fund's net
assets.

9. Commodities

U.S. FUND

The U.S. Fund may not purchase, sell or invest in physical
commodities, unless acquired as a result of ownership of securities or other
instruments (but this shall not prevent the Fund from purchasing or selling
options and futures contracts or from investing in securities of other
instruments backed by physical commodities).

INTERNATIONAL FUND

The Fund may not purchase, sell or invest in commodities, provided
that this restriction shall not prohibit the Fund from purchasing and selling
securities or other instruments backed by commodities or financial futures
contracts and related options, including but not limited to, currency futures
contracts and stock index futures.

10. Real Estate

U.S. FUND

The U.S. Fund may not purchase, sell or invest in real estate, but may
invest in securities of companies that deal in real estate or are engaged in the
real estate business, including real estate investment trusts, and securities
secured by real estate or interests therein and may hold and sell real estate
acquired through default, liquidation or other distributions of an interest in
real estate as a result of the Fund's ownership of such securities.

INTERNATIONAL FUND

17
<PAGE>

The International Fund may not purchase or invest in real estate or
interests in real estate (although it may purchase securities secured by real
estate or interests therein or issued by companies or investment trusts which
invest in real estate or interests therein).

11. Borrowing, Senior Securities, Reverse Repurchase Agreements

Neither Fund may issue senior securities as defined by the Investment
Company Act of 1940, as amended (the "1940 Act"), except that a Fund may borrow
money from banks and enter into reverse repurchase agreements (i) in the
aggregate amount of up to 10% of the value of its assets to increase its
holdings of portfolio securities and (ii) for temporary extraordinary or
emergency purposes, subject to the overall limitation that total borrowings by
the Fund (including borrowing through reverse repurchase agreements) may not
exceed 33 1/3% of the value of the Fund's total assets (measured in each case at
the time of borrowing).

12. Joint Trading

The U.S. Fund* and the International Fund may not participate on a
joint or joint and several basis in any trading account in any securities. (The
"bunching" of orders for the purchase or sale of portfolio securities with its
investment adviser or accounts under its management to reduce brokerage
commissions, to average prices among them or to facilitate such transactions is
not considered a trading account in securities for purposes of this
restriction.)

13. Pledging Assets

Neither Fund may pledge, mortgage, hypothecate or otherwise encumber
its assets, except to secure permitted borrowings and to implement collateral
and similar arrangements incident to permitted investment practices

14. Investing in Securities of Other Investment Companies

The U.S. Fund* and the International Fund* will each limit its
investment in other investment companies to no more than 3% of the total
outstanding voting stock of any investment company, will invest no more than 5%
of its total assets in any one investment company and will invest no more than
10% of its total assets in investment companies in general. The Funds will
purchase securities of closed-end investment companies only in open-market
transactions involving customary broker's commissions. However, these
limitations are not applicable if the securities are acquired in a merger,
consolidation or acquisition of assets.

15. Illiquid Securities.

Neither Fund may invest more than 15% of its net assets in illiquid
securities and other securities which are not readily marketable, including
repurchase agreements which have a maturity of longer than seven days, but
excluding securities eligible for resale under Rule 144A of the 1933 Act, which
the Trustees have determined to be liquid.*

16. Options -- U.S. Fund Only

18
<PAGE>

The U.S. Fund may not write, purchase or sell put or call options, or
combinations thereof, except that the Fund may do so as permitted under
"DERIVATIVE INVESTMENTS" in the Fund's Prospectus.*

17. Futures and Options Transactions -- U.S. Fund Only.*

The U.S. Fund may not purchase financial futures contracts and related
options except for "bona fide hedging" purposes, but may enter into such
contracts for non-hedging purposes provided that aggregate initial margin
deposits plus premiums paid by the Fund for open futures options positions, less
the amount by which any such positions are "in-the-money", may not exceed 5% of
the Fund's total assets.

Except as otherwise stated in this Statement of Additional
Information or in the Prospectus, if a percentage limitation set forth in an
investment policy or restriction of a Fund is adhered to at the time of
investment or at the time a Fund engages in a transaction, a subsequent increase
or decrease in percentage resulting from a change in value of an investment or
position, or a change in the net assets of a Fund, will not result in a
violation of such restriction.

For purposes of their policies and limitations, the Funds consider
certificates of deposit and demand and time deposits issued by a U.S. branch of
a domestic bank or savings and loan association having capital, surplus, and
undivided profits in excess of $100,000,000 at the time of investment to be
"cash items".

CERTAIN RISK CONSIDERATIONS

There can be no assurance that a Fund will achieve its investment
objective and an investment in the Funds involves certain risks which are
described under "DESCRIPTION OF THE FUNDS - Investment Objectives and Policies"
in the Funds' Prospectuses.

While each Fund is technically diversified within the meaning of the
1940 Act, because the Funds concentrate their investments in the securities of
companies engaged principally in the real estate industry, investors should
understand that investment in the Funds may be subject to greater risk and
market fluctuation than an investment in a portfolio of securities representing
a broader range of industry investment alternatives.

Borrowing.

The International Fund has borrowings outstanding. It is in essence
leveraged and, therefore, share price fluctuations may be more pronounced than
the market in general. The table set forth below describes the extent to which
the Fund entered into borrowing transactions during the five fiscal periods
ended October 31, 1997.

19
<PAGE>

<TABLE>
<CAPTION>
Amount of Debt Average Amount of Average Number of Average Amount of
Outstanding End of Debt Outstanding Shares Outstanding Debt Per-Share
Year Ended Year During the Year During the Year During Year
---------- ------------------ ----------------- ------------------ -----------------
<S> <C> <C> <C> <C>

9/30/94* $4,885,000 $2,090,861 10,670,806 $0.20
9/30/95 $0 $1,572,261 7,184,794 $0.22
10/31/95** $1,050,000 $283,871 5,474,147 $0.05
10/31/96 $0 $583,642 4,432,611 $0.13
10/31/97 $775,000 $320,892 3,275,765 $0.10

* Nine Months
** One Month
</TABLE>

MANAGEMENT

The Trustees and executive officers of the Trust, their ages,
addresses and principal occupations during the past five years are set forth
below:

Laurence B. Ashkin (68), 180 East Pearson Street, Chicago, IL-Trustee.
Real estate developer and construction consultant since 1980; President of
Centrum Equities since 1987 and Centrum Properties, Inc. since 1980.

Foster Bam (69), Greenwich Plaza, Greenwich, CT-Trustee. Partner in
the law firm of Cummings and Lockwood since 1968.

H. Guy Leibler (43), 25 Cowdry Park Drive, Greenwich, CT-Trustee.
Chairman and President of Pailatus, a news media company (since January 1997);
Director and Chairman of White Plains Hospital Center (since April 1988);
Advisor to Sony/Loews Theaters, an entertainment company (July 1995 to March
1997); President of Sony Plaza, Inc., a consumer electronics, music and film
company (January 1993 to June 1995); and President and Chief Executive Officer
of Schulman Realty.

Samuel A. Lieber* (41), 2500 Westchester Avenue, Purchase, New York
- -Trustee and President. Member of Alpine Management & Research, LLC since
November 1997. Formerly, Portfolio Manager of Evergreen U.S. Real Estate Equity
Fund (since 1993) and Evergreen Global Real Estate Equity Fund (since 1989),
employed by Evergreen Asset Management Corp.

Marc Halle (36), 2500 Westchester Avenue, Purchase, New York -
Secretary/Treasurer. Member of Alpine Management & Research, LLC since November
1997. Formerly, Real Estate Analyst of Evergreen U.S. Real Estate Equity Fund
and Evergreen Global Real Estate Equity Fund since 1994, employed by Evergreen
Asset Management Corp. Acquisition and Finance, W& M Properties, Inc. from 1989
to 1994.

* Trustee who is deemed to be an "interested person" of the Trust,
as such term is defined by the 1940 Act.

20
<PAGE>

The officers of the Trusts are all officers and/or employees of the
Adviser.

The Trust pays an annual fee to each Trustee who is not an officer or
employee of the Trust's investment adviser or distributor (or any affiliated
company of the investment adviser or distributor) in the amount of $5,000.
Travel expenses of Trustees who are not affiliated persons of the Trust's
investment adviser or distributor (or any affiliated company of the investment
adviser or distributor) which are incurred in connection with attending meetings
of the Board of Trustees will also be reimbursed.

Set forth below for each of the Trustees is the aggregate compensation
(and expenses) paid to such Trustees by the Trust for the twelve month period
ended September 30, 1997.

TRUSTEES COMPENSATION TABLE

COMPENSATION FROM TRUST
TRUSTEE COMPENSATION FROM TRUST AND FUND COMPLEX
- --------------------------------------------------------------------------------

Laurence B. Ashkin $476.23 $63,400

Charles A. Austin III* 41,400

Foster Bam 176.08 48,575

K. Dun Gifford* 38,700

James S. Howell 511.98 100,542

Robert Jeffries 187.14 14,600

Leroy Keith Jr.* 37,800

Gerald M. McDonnell 376.94 87,051

Thomas L. McVerry 490.88 91,101

William Walt Pettit 476.74 89,101

David M. Richardson* 41,400

Russell A. Salton, III 476.93 90,701

Michael S. Scofield 376.93 87,801

Richard J. Shima 15.94 61,125

* Not a Trustee of the Trust during the relevant fiscal period.

As of December 31, 1997, the officers and Trustees of the Trust owned
as a group less than 1% of the outstanding shares of any class of the Fund.

Set forth below is information with respect to each person, who, to
each Fund's knowledge, owned beneficially or of record more than 5% of a class
of each Fund's total

21
<PAGE>

outstanding shares and their aggregate ownership of the Fund's total outstanding
shares as of January 12, 1998.

NAME AND ADDRESS NAME OF NUMBER OF SHARES % OF CLASS/FUND
FUND/CLASS
<S> <C> <C> <C>
Stephen A. Lieber U.S. Fund / Y 265,773.195 21.997%/12.216%
1210 Greacon Point Rd.
Mamaroneck, NY 10543-4693

Constance E. Lieber U.S. Fund / Y 91,209.715 6.91%/4.192%
1210 Greacon Point Rd.
Mamaroneck, NY 10543-4693

Charles Schwab & Co. Inc. U.S. Fund / Y 76,866.354 6.131%/3.533%
Special Custody Account for
the Exclusive Benefit of
Customers Reinvest Account
Mut Fds Dept
Attn: Mutual Funds Dept
101 Montgomery St.
San Francisco, CA 94104-4122

The Essel Foundation U.S. Fund / Y 117,577.155 9.378%/5.404%
1210 Greacen Point Rd.
Mamaroneck, NY 10543-4693

Charles Schwab & Co. Inc. U.S. Fund / A 52,300.505 16.440%/2.404%
Special Custody Account for
the Exclusive Benefit of
Customers
Attn: Mutual Funds Dept
101 Montgomery St.
San Francisco, CA 94104-4122

NFSC FEBO #367-355550 U.S. Fund / A 20,620.915 6.482%/0.948%
Charles L. Cabe
Separate Property
C/O CLC Interests
5956 Sherry Ln Ste 1000
Dallas, TX 75225-8021

NFSC FEBO #191-114421 U.S. Fund / A 18,126.000 5.698%/0.833%
Fmt Co Cust IRA
FBO Robert P. White
RR 3 Box 587-1
Jasper, TX 75951

22
<PAGE>

MLPF&S for the sole benefit U.S. Fund / B 64,876.000 14.964%/2.982%
Of its Customers
Attn: Fund Administration
4800 Deer Lake Dr. E 3rd Floor
Jacksonville, FL 32246-6484

Prudential Securities Inc. FBO U.S. Fund / B 23,614.576 5.477%/1.085%
Harold L. Endlich Ttee
Harold L. Endlich 1993
Revocable Intervivos Trust UA
DTD 11/05/93
Northridge, CA 91325-2613

MLPF&S for the sole benefit U.S. Fund / C 54,214.000 31.857%/2.492%
of its Customers
Attn: Fund Administration
4800 Deer Lake Dr. E 3rd Floor
Jacksonville, FL 32246-6484

NFSC FEBO #X54-079561 U.S. Fund / C 11,081.538 6.510%/0.509%
Thompson Family Trust
Howard J. Thompson Jr Trustee
U/A 0-6/15/93
3755 Milan St.
San Diego, CA 92107-3711

Stephen A. Lieber International 940,448.479 30.517%/33.486%
1210 Greacon Point Rd. Fund / Y
Mamaroneck, NY 10543-4693

Charles Schwab & Co. Inc. International 319,957.271 11.6180%/11.392%
Special Custody Account for the Fund / Y
Exclusive Benefit of Customers
Reinvest Account Mut Fds Dept
Attn: Mutual Funds Dept
101 Montgomery St.
San Francisco, CA 94104-4122

Samuel A. Lieber International 148,396.468 5.388%/5.284%
2 Beach Ave. Fund / Y
Larchmont, NY 10538-4005

Charles Schwab & Co. Inc. International 16,918.814 61.109%/0.602%
Special Custody Account for the Fund / A
Exclusive Benefit of Customers

23
<PAGE>

Attn: Mutual Funds Dept.
101 Montgomery St.
San Francisco, CA 94104-4122

Fifth Third Bank Ttee Agt. International 2,894.356 10.454%/0.103%
FBO Ben C. Kaufmann Fund / A
A/C 38-0-6202337
U/A DTD 5/11/95
P.O. Box 630074
Cincinnati, OH 45263

First Union NatAEI Bank u C/F IN International 1,690.238 6.105%/0.060%
Deborah R. Shore IRA Fund / A
5706 Cricket Place
McLean, VA 22101

First Union NatAEI Bank u C/F IN International 1,663.182 6.007%/0.059%
Harris Shore IRA Fund / A
5706 Cricket Place
McLean, VA 22101

MLPF&S for the sole benefit International 2,213.000 12.870%/0.079%
Of its Customers Fund / B
Attn: Fund Administration
4800 Deer Lake Dr. E. 3rd Floor
Jacksonville, FL 32246-6484

Donaldson Lufkin Jenrette International 1,612.274 9.376%/0.057%
Securities Corporation Inc. Fund / B
P.O. Box 2052
Jersey City, NJ 07303-2052

State Street Bank & Trust Co. International 1,605.644 9.3379%/0.057%
Cust for the IRA of Fund / B
Patricia L. Corey
129 Briarwood Dr.
New Befdford, MA 02745-4206

NFSC FEBO #OKS-628913 International 1,212.611 7.052%/0.043%
NFSC/FMTC IRA Rollover Fund / B
FBO Theodore C. Fleming
1007 Sierra Vista Ct.
Burleson, TX 76028-4061

Painewebber for the benefit of International 2,793.296 28.984%/0.099%
Painewebber CDN FBO Fund / C

24
<PAGE>

William R. Mack Jr.
P.O. box 3321
Weehawken, NJ 07087-8154

Ameritrade Clearing Inc. International 2,421.308 25.125%/0.086%
FBO 4520000367 Fund / C
PO Box 2226
Omaha, NE 68103-2226

Painewebber for the benefit of International 1,552.795 16.112%/0.055%
Peter J. Haigh Fund / C
Ann Haigh Jtwros
310 S. Highland Ave.
Pittsburgh, PA 15206

MLPF&S for the sole benefit International 1,259.000 13.064%/0.045%
of its Customers Fund / C
Attn: Fund Administration
4800 Deer Lake Dr. E, 3rd Floor
Jacksonville, FL 32246-6484
</TABLE>

As a result of his direct and beneficial ownership of 33.486% of the
International Fund on January 12, 1998, Stephen A. Lieber may be deemed to
"control" the Fund as that term is defined in the 1940 Act.

INVESTMENT ADVISER

(See also "MANAGEMENT OF THE FUNDS" in the Funds' Prospectuses)

The management of each Fund is supervised by the Trustees of the
Trust. Alpine Management & Research, LLC provides investment advisory services
to the Funds pursuant to Investment Advisory Agreements entered into with the
Trust (the "Advisory Agreements").

The Adviser, located at 2500 Westchester Avenue, Purchase, New York
10577, is a newly formed Delaware limited liability company. It was formed for
the purpose of providing investment advisory and management services to
investment companies (including the Funds) and other advisory clients. The
members of the Adviser are Messrs. Samuel A. Lieber, who is the controlling
person of the Adviser, and Marc R. Halle. The Adviser does not have any
officers. Although the Adviser has no operating history and has not previously
served as the investment adviser of a mutual fund, its members were the
individuals associated with the former investment adviser of the Funds who were
primarily responsible for investment advisory services provided to the Funds.
Pursuant to an Asset Purchase Agreement dated as of December 17, 1997 by and
among the Adviser, Mr. Samuel Lieber and Evergreen Asset Management Corp.
("EAM"), the Adviser acquired from EAM certain of its assets that relate to the
management and operations of the Funds. EAM is owned by First Union National
Bank, North Carolina which, in turn, is a subsidiary of First Union Corporation,
a bank holding company headquartered in Charlotte, North Carolina.

25
<PAGE>

Under its Investment Advisory Agreement with each Fund, the Adviser
has agreed to furnish reports, statistical and research services and
recommendations with respect to each Fund's portfolio of investments. In
addition, the Adviser provides office facilities to the Funds and performs a
variety of administrative services. Each Fund pays the cost of all of its other
expenses and liabilities, including expenses and liabilities incurred in
connection with maintaining their registration under the 1933 Act, and the 1940
Act, printing prospectuses (for existing shareholders) as they are updated,
state qualifications, mailings, brokerage, custodian and stock transfer charges,
printing, legal and auditing expenses, expenses of shareholder meetings and
reports to shareholders. Notwithstanding the foregoing, the Adviser will pay
the costs of printing and distributing prospectuses used for prospective
shareholders.

The method of computing the investment advisory fee for each Fund is
described in the Prospectus. The advisory fees paid by each of the Funds to EAM
for the three most recent fiscal periods were as follows:

U.S. FUND YEAR ENDED YEAR ENDED YEAR ENDED
9/30/97 9/30/96 9/30/95

Advisory Fee $156,812 $104,850 $85,509
Waiver (106,421) (104,850) (85,509)
----------- ----------- -----------
Net Advisory Fee $50,391 $0 $0
----------- ----------- -----------
----------- ----------- -----------
Expense
Reimbursement $10,294 $107,348 $43,013
----------- ----------- -----------

INTERNATIONAL YEAR ENDED YEAR ENDED ONE MONTH YEAR ENDED
FUND 10/31/97 10/31/96 ENDED 10/31/95 9/90/95

Advisory Fee $410,740 $580,089 $55,450 $869,965
Waiver (33,874) (37,319) --- ---
---------- ----------- ------------- ----------
Net Advisory Fee $376,866 $542,770 $55,450 $869,965
---------- ----------- ------------- ----------
---------- ----------- ------------- ----------
Expense
Reimbursement $0 $27,960 $8,469 $39,432
---------- ----------- ------------- ----------

The International Fund changed its fiscal year end from September 30
to October 31, during the periods covered by the foregoing table. Accordingly,
the investment advisory fees reported in the foregoing table reflect for the
International Fund, the fiscal year ended September 30, 1995, the one month
period ended October 31, 1995, and the fiscal year ended October 31, 1996.

Expense Limitations

The Funds' prior investment adviser had voluntarily limited (and the
Adviser may in the future limit) expenses of certain of the Funds. For further
information, refer to the expense information in the current Prospectus.

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<PAGE>

The Investment Advisory Agreement of each Fund is terminable, without
the payment of any penalty, on sixty days' written notice, by a vote of the
holders of a majority of the Fund's outstanding shares, or by a vote of a
majority of the Trustees or by the Adviser. The Investment Advisory Agreements
will automatically terminate in the event of their assignment. Each Investment
Advisory Agreement provides in substance that the Adviser shall not be liable
for any action or failure to act in accordance with its duties thereunder in the
absence of willful misfeasance, bad faith or gross negligence on the part of the
Adviser or of reckless disregard of its obligations thereunder.

Each Fund's Investment Advisory Agreement became effective on February
__, 1998 and has an initial term of two years. The agreements were approved by
the persons then serving as Trustees, including a majority of the Trustees who
were not "interested persons" of the Trust, as defined by the 1940 Act
("Independent Trustees"), on December 17, 1997 and were approved by the
shareholders of each Fund on February 17, 1998. Each Investment Advisory
Agreement may be continued in effect from year to year after its initial term,
provided that its continuance is approved annually by the Trustees or by a
majority of the outstanding voting shares of the Fund, and in each case is also
approved by a majority of the Independent Trustees by vote cast in person at a
meeting duly called for the purpose of voting on such approval.

Certain other clients of the Adviser may have investment objectives
and policies similar to those of the Funds. The Adviser may, from time to time,
make recommendations which result in the purchase or sale of a particular
security by its other clients simultaneously with a Fund. If transactions on
behalf of more than one client during the same period increase the demand for
securities being purchased or the supply of securities being sold, there may be
an adverse effect on price or quantity. It is the policy of the Adviser to
allocate advisory recommendations and the placing of orders in a manner which is
deemed equitable by the Adviser to the accounts involved, including the Funds.
When two or more of the clients of the Adviser are purchasing or selling the
same security on a given day from the same broker-dealer, such transactions may
be averaged as to price.

The Funds and other accounts managed by the Adviser rely upon the same
resources for investment advice and recommendations. Therefore, the Funds and
such accounts may simultaneously purchase or sell the same security. This could
have a detrimental effect on the price and quantity of the security available to
a Fund. If simultaneous transactions occur, the Adviser attempts to allocate
the securities, both as to price and quantity, in accordance with a method
deemed equitable to each Fund. In some cases, simultaneous purchases or sales
could have a beneficial effect, in that the ability of one Fund to participate
in volume transactions may produce better executions for that Fund.

The Funds have adopted procedures under Rule 17a-7 of the 1940 Act to
permit purchase and sales transactions to be effected between each Fund or
between a Fund and certain other accounts that are managed by the Adviser. Each
Fund may from time to time engage in such transactions in accordance with these
procedures.

27
<PAGE>

DISTRIBUTION PLANS

Each Fund has entered into a distribution agreement with Evergreen
Keystone Distributor, Inc. (the "Distributor"), an affiliate of BISYS Fund
Services, pursuant to which the Distributor has been retained to distribute
shares of the Funds.

Reference is made to "MANAGEMENT OF THE FUNDS - Distribution Plans and
Agreements" in the Prospectus for the Class A, Class B and Class C shares of the
Funds for additional disclosure regarding the Funds' distribution arrangements.
Distribution fees are accrued daily and paid monthly on the Class A, Class B and
Class C shares and are charged as class expenses, as accrued. The distribution
fees attributable to the Class B shares and Class C shares are designed to
permit an investor to purchase such shares through broker-dealers without the
assessment of a front-end sales charge, and, in the case of Class C shares,
without the assessment of a contingent deferred sales charge after the first
year following purchase, while at the same time permitting the Distributor to
compensate broker-dealers in connection with the sale of such shares. In this
regard, the purpose and function of the combined contingent deferred sales
charge and distribution services fee on the Class B shares and the Class C
shares, are the same as those of the front-end sales charge and distribution fee
with respect to the Class A shares in that in each case the sales charge and/or
distribution fee provide for the financing of the distribution of the Fund's
shares.

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

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

The Funds commenced offering Class A, Class B and Class C shares on
January 3, 1995. The Plan with respect to each Fund became effective on
December 30, 1994, and was initially approved by the sole shareholder of each
Class of shares of the Funds with respect to which a Plan was adopted on that
date and by the unanimous vote of the Trustees of the Trust, including a
majority of the Independent Trustees, at a meeting called for that purpose and
held on December 13, 1994. The Distribution Agreement between the Funds and the
Distributor, pursuant to which distribution fees are paid under the Plan by each
Fund with respect to its Class A, Class B and Class C shares was also approved
at the December 13, 1994 meeting by the unanimous vote of the Trustees,
including a majority of the Independent Trustees.

Each Plan and Distribution Agreement will continue in effect for
successive twelve-month periods; provided, however, that such continuance is
specifically approved at least

28
<PAGE>

annually by the Trustees of the Trust or by vote of the holders of a majority of
the outstanding voting securities of that Class, and, in either case, by a
majority of the Independent Trustees.

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

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

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

The International Fund incurred distribution and shareholder services
fees pursuant to its Rule 12b-1 Plan on behalf of Class A, Class B, and Class C
shares, of $165, $164, and $49, respectively, for the period February 10, 1995,
February 8, 1995, and February 9, 1995,

29
<PAGE>

respectively (commencement of class operations) through September 30, 1995; $16,
$97, and $6, respectively, for the period October 1, 1995 through October 31,
1995; $2,800, $1,020 and $104, respectively for the fiscal year ended October
31, 1996; and $1,597, $1,937 and $870, respectively, for the fiscal year ended
October 31, 1997.

The U.S. Fund incurred distribution and shareholder services fees
pursuant to its Rule 12b-1 Plan for the fiscal period from January 3, 1995
through September 30, 1995, the fiscal year ended September 30, 1996 and the
fiscal year ended September 30, 1997 of: $6, $307 and $1,824, on behalf of the
Class A shares; $269, $2,250 and $12,232 on behalf of the Class B shares; and
$5, $328 and $4,917, on behalf of the Class C shares.

ALLOCATION OF BROKERAGE

Decisions regarding the placement of orders to purchase and sell
investments for the Funds are made by the Adviser, subject to the supervision of
the Trustees. A Fund will not effect any brokerage transactions with any broker
or dealer affiliated directly or indirectly with the Adviser unless such
transactions are fair and reasonable, under the circumstances, to the Fund's
shareholders. Circumstances that may indicate that such transactions are fair
or reasonable include the frequency of such transactions, the selection process
and the commissions payable in connection with such transactions.

A substantial portion of the transactions in equity securities for the
U.S. Fund and International Fund will occur on domestic stock exchanges and
foreign stock exchanges, respectively. Transactions on stock exchanges involve
the payment of brokerage commissions. In transactions on stock exchanges in the
United States, these commissions are negotiated, whereas on many foreign stock
exchanges these commissions are fixed. In the case of securities traded in the
foreign and domestic over-the-counter markets, there is generally no stated
commission, but the price usually includes an undisclosed commission or markup.
Over-the-counter transactions will generally be placed directly with a principal
market maker, although the Fund may place an over-the-counter order with a
broker-dealer if a better price (including commission) and execution are
available.

It is anticipated that most purchase and sale transactions involving
fixed income securities will be with the issuer or an underwriter or with major
dealers in such securities acting as principals. Such transactions are normally
on a net basis and generally do not involve payment of brokerage commissions.
However, the cost of securities purchased from an underwriter usually includes a
commission paid by the issuer to the underwriter. Purchases or sales from
dealers will normally reflect the spread between the bid and ask price.

The policy of the Funds regarding purchases and sales of securities is
that primary consideration will be given to obtaining the most favorable prices
and efficient executions of transactions. Consistent with this policy, when
securities transactions are effected on a stock exchange, the Funds' policy is
to pay commissions which are considered fair and reasonable without necessarily
determining that the lowest possible commissions are paid in all circumstances.
The Board of Trustees of the Trust believes that a requirement always to seek
the lowest commission cost could impede effective management and preclude the
Funds and the

30
<PAGE>

Adviser from obtaining high quality brokerage and research services. In seeking
to determine the reasonableness of brokerage commissions paid in any
transaction, the Adviser may rely on its experience and knowledge regarding
commissions generally charged by various brokers and on their judgment in
evaluating the brokerage and research services received from the broker
effecting the transaction. Such determinations are necessarily subjective and
imprecise, as in most cases an exact dollar value for those services is not
ascertainable.

In seeking to implement the Funds' policies, the Adviser effects
transactions with those brokers and dealers who it believes provide the most
favorable prices and which are capable of providing efficient executions. If
the Adviser believes such price and execution are obtainable from more than one
broker or dealer, it may give consideration to placing transactions with those
brokers and dealers who also furnish research and other services to the Funds or
the Adviser. Such services may include, but are not limited to, any one or more
of the following: information as to the availability of securities for purchase
or sale; statistical or factual information or opinions pertaining to
investments; wire services; and appraisals or evaluations of securities. The
information and services received by the Adviser from brokers and dealers may be
of benefit in the management of accounts of other clients and may not in all
cases benefit the Funds directly. While such services are useful and important
in supplementing its own research and facilities, the Adviser believes the value
of such services is not determinable and does not significantly reduce its
expenses.

The Trustees have adopted procedures pursuant to Rule 17e-1 under the
1940 Act to ensure that all brokerage transactions with affiliated
broker-dealers, are fair and reasonable.

The following chart shows: (1) the brokerage commissions paid by each
Fund during its last three fiscal years; (2) the amount and percentage thereof
paid to Lieber and Company ("LAC"), a registered broker-dealer that is an
affiliate of the investment adviser of the Funds; and (3) the percentage of the
total dollar amount of all portfolio transactions with respect to which
commissions have been paid which were effected by LAC:

YEAR ENDED YEAR ENDED YEAR ENDED
U.S. FUND 9/30/97 9/30/96 9/30/95

TOTAL BROKERAGE $164,711 $114,230 $71,440
COMMISSIONS
DOLLAR AMOUNT AND % $152,636 $109,622 $68,714
PAID TO LAC 92.67% 96% 96%
% OF TRANSACTIONS
EFFECT BY LAC 91% 94% 95%

INTERNATIONAL FUND YEAR ENDED YEAR ENDED ONE MONTH YEAR ENDED
10/31/97 10/31/96 ENDED 10/31/95 9/30/95

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<PAGE>

TOTAL BROKERAGE $139,852 $221,762 $8,314 $532,714
COMMISSIONS
DOLLAR AMOUNT AND $41,643 $40,808 $2,374 $106,123
% PAID TO LAC 29.76% 18% 29% 20%
% OF TRANSACTIONS
EFFECT BY LAC 30% 25% 36% 31%

ADDITIONAL TAX INFORMATION

(See also "DIVIDENDS, DISTRIBUTIONS AND TAXES" in the Prospectus)

Each Fund has qualified and intends to continue to qualify for and
elect the tax treatment applicable to regulated investment companies ("RIC")
under Subchapter M of the Internal Revenue Code of 1986, as amended (the
"Code"). (Such qualification does not involve supervision of management or
investment practices or policies by the Internal Revenue Service.) In order to
qualify as a regulated investment company, a Fund must, among other things,
(a) derive at least 90% of its gross income from dividends, interest, payments
with respect to proceeds from securities loans, gains from the sale or other
disposition of securities or foreign currencies and other income (including
gains from options, futures or forward contracts) derived with respect to its
business of investing in such securities and (b) diversify its holdings so that,
at the end of each quarter of its taxable year, (i) at least 50% of the market
value of the Fund's total assets is represented by cash, U.S. government
securities and other securities limited in respect of any one issuer, to an
amount not greater than 5% of the Fund's total assets and 10% of the outstanding
voting securities of such issuer, and (ii) not more than 25% of the value of its
total assets is invested in the securities of any one issuer (other than U.S.
government securities and securities of other regulated investment companies).
By so qualifying, a Fund is not subject to Federal income tax if it timely
distributes its investment company taxable income and any net realized capital
gains. A 4% nondeductible excise tax will be imposed on a Fund to the extent it
does not meet certain distribution requirements by the end of each calendar
year. Each Fund anticipates meeting such distribution requirements.

Dividends paid by a Fund from investment company taxable income
generally will be taxed to the shareholders as ordinary income. Investment
company taxable income includes net investment income and net realized
short-term gains (if any). Any dividends received by a Fund from domestic
corporations will constitute a portion of the Fund's gross investment income.
It is anticipated that this portion of the dividends paid by a Fund (other than
distributions of securities profits) will qualify for the 70% dividends-received
deduction for corporations. Shareholders will be informed of the amounts of
dividends which so qualify.

Distributions of the excess of net long-term capital gain over net
short-term capital loss are taxable to shareholders (who are not exempt from
tax) as long-term capital gain, regardless of the length of time the shares of a
Fund have been held by such shareholders. Short-term capital gains
distributions are taxable to shareholders who are not exempt from tax as
ordinary income. Such distributions are not eligible for the dividends-received
deduction. Any loss recognized upon the sale of shares of a Fund held by a
shareholder for six months or less

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<PAGE>

will be treated as a long-term capital loss to the extent that the shareholder
received a long-term capital gain distribution with respect to such shares.

Distributions of investment company taxable income and any net
short-term capital gains will be taxable as ordinary income as described above
to shareholders (who are not exempt from tax), whether made in shares or in
cash. Shareholders electing to receive distributions in the form of additional
shares will have a cost basis for Federal income tax purposes in each share so
received equal to the net asset value of a share of a Fund on the reinvestment
date.

Distributions by each Fund result in a reduction in the net asset
value of the Fund's shares. Should a distribution reduce the net asset value
below a shareholder's cost basis, such distribution nevertheless would be
taxable as ordinary income or capital gain as described above to shareholders
(who are not exempt from tax), even though, from an investment standpoint, it
may constitute a return of capital. In particular, investors should be careful
to consider the tax implications of buying shares just prior to a distribution.
The price of shares purchased at that time includes the amount of the
forthcoming distribution. Those purchasing just prior to a distribution will
then receive what is in effect a return of capital upon the distribution which
will nevertheless be taxable to shareholders subject to taxes.

Upon a sale or exchange of its shares, a shareholder will realize a
taxable gain or loss depending on its basis in the shares. Such gain or loss
will be treated as a capital gain or loss if the shares are capital assets in
the investor's hands and will be a long-term capital gain or loss if the shares
have been held for more than one year. Generally, any loss realized on a sale
or exchange will be disallowed to the extent shares disposed of are replaced
within a period of sixty-one days beginning thirty days before and ending thirty
days after the shares are disposed of. Any loss realized by a shareholder on
the sale of shares of the Fund held by the shareholder for six months or less
will be disallowed to the extent of any exempt interest dividends received by
the shareholder with respect to such shares, and will be treated for tax
purposes as a long-term capital loss to the extent of any distributions of net
capital gains received by the shareholder with respect to such shares.

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

Shareholders who fail to furnish their taxpayer identification numbers
to a Fund and to certify as to its correctness and certain other shareholders
may be subject to a 31% Federal income tax backup withholding requirement on
dividends, distributions of capital gains and redemption proceeds paid to them
by the Fund. If the withholding provisions are applicable, any such dividends
or capital gain distributions to these shareholders, whether taken in cash or
reinvested in additional shares, and any redemption proceeds will be reduced by
the amounts required to be withheld. Investors may wish to consult their own
tax advisers about the applicability of the backup withholding provisions. The
foregoing discussion relates solely to U.S. Federal income tax law as applicable
to U.S. persons (i.e., U.S. citizens and residents and

33
<PAGE>

U.S. domestic corporations, partnerships, trusts and estates). It does not
reflect the special tax consequences to certain taxpayers (e.g., banks,
insurance companies, tax exempt organizations and foreign persons).
Shareholders are encouraged to consult their own tax advisers regarding specific
questions relating to Federal, state and local tax consequences of investing in
shares of a Fund. Each shareholder who is not a U.S. person should consult his
or her tax adviser regarding the U.S. and foreign tax consequences of ownership
of shares of a Fund, including the possibility that such a shareholder may be
subject to a U.S. withholding tax at a rate of 31% (or at a lower rate under a
tax treaty) on amounts treated as income from U.S. sources under the Code.

Special Tax Considerations

Each Fund maintains accounts and calculates income in U.S. dollars.
In general, gains or losses on the disposition of debt securities denominated in
a foreign currency that are attributable to fluctuations in exchange rates
between the date the debt security is acquired and the date of disposition,
gains and losses attributable to fluctuations in exchange rates that occur
between the time a Fund accrues interest or other receivables or accrues
expenses or other liabilities denominated in a foreign currency and the time the
Fund actually collects such receivable or pays such liabilities, and gains and
losses from the disposition of foreign currencies and foreign currency forward
contracts will be treated as ordinary income or loss. These gains or losses
increase or decrease, respectively, the amount of a Fund's investment company
taxable income available to be distributed to its shareholders as ordinary
income.

Each Fund's transactions in foreign currencies, forward contracts,
options and futures contracts (including options and futures contracts on
foreign currencies) are subject to special provisions of the Code that, among
other things, may affect the character of gains and losses of the Fund (i.e.,
may affect whether gains or losses are ordinary or capital), accelerate
recognition of income to the Fund and defer Fund losses. These rules could
therefore affect the character, amount and timing of distributions to
shareholders. These provisions also (a) require a Fund to mark-to-market
certain types of positions in its portfolio (i.e., treat them as if they were
closed out) and (b) may cause a Fund to recognize income without receiving cash
with which to pay dividends or make distributions in amounts necessary to
satisfy the distribution requirements for avoiding U.S. Federal income and
excise taxes. Each Fund will monitor its transactions, make appropriate tax
elections and make appropriate entries in its books and records when it acquires
any foreign currency, forward contract, option, futures contract or hedged
investment in order to mitigate the effect of these rules. The Funds anticipate
that their hedging activities will not adversely affect their regulated
investment company status.

Income received by a Fund from sources within various foreign
countries may be subject to foreign income tax. If more than 50% of the value
of a Fund's total assets at the close of its taxable year consists of the stock
or securities of foreign corporations, the Fund may elect to "pass through" to
the Fund's shareholders the amount of foreign income taxes paid by the Fund.
Pursuant to such election, shareholders would be required: (i) to treat a
proportionate share of dividends paid by the Fund which represent foreign source
income received by the Fund plus the foreign taxes paid by the Fund as foreign
source income; and (ii) either to deduct their pro-rata share of foreign taxes
in computing their taxable income, or to use it as a foreign tax

34
<PAGE>

credit against Federal income taxes (but not both). No deduction for foreign
taxes could be claimed by a shareholder who does not itemize deductions.

Each Fund intends to meet for each taxable year the requirements of
the Code to "pass through" to its shareholders foreign income taxes paid if it
is determined by its Adviser to be beneficial to do so. There can be no
assurance that the Fund will be able to pass through foreign income taxes paid.
Each shareholder will be notified within 60 days after the close of each taxable
year of the Fund whether the foreign taxes paid by the Fund will "pass through"
for that year, and, if so, the amount of each shareholder's pro-rata share (by
country) of (i) the foreign taxes paid and (ii) the Fund's gross income from
foreign sources. Of course, shareholders who are not liable for Federal income
taxes, such as retirement plans qualified under Section 401 of the Code, will
not be affected by any such "pass through" of foreign tax credits.

Each Fund may invest in certain entities that may qualify as "passive
foreign investment companies". Generally, the income of such companies may
become taxable to the Fund prior to the receipt of distributions, or,
alternatively, income taxes and interest charges may be imposed on the Fund on
"excess distributions" received by the Fund or on gain from the disposition of
such investments by the Fund. Each Fund will take steps to minimize income
taxes and interest charges arising from such investments. If a Fund elects to
treat any such company as a "qualified electing fund" under the Code, in lieu
of the foregoing requirements, the Fund would be required to include in
income each year a portion of the ordinary earnings and net capital gain of
the company. Under recently enacted legislation, during any taxable year
commencing after December 31, 1997, a Fund can elect to mark-to-market at the
end of each taxable year its investment in such a company, recognizing as
ordinary income any increase in the value of the investment, and as ordinary
loss any decrease in such value to the extent it did not exceed prior
increases included in income. Under either election, a Fund might be
required to recognize in a year income in excess of its distributions and its
proceeds from dispositions with respect to the stock of the company during
that year, and such income would nevertheless be subject to the distribution
requirements of the Fund described above.

NET ASSET VALUE

The following information supplements that set forth in the Fund's
Prospectuses under the subheading "How to Buy Shares - How the Funds Value Their
Shares" in the Section entitled "PURCHASE AND REDEMPTION OF SHARES".

The public offering price of shares of each Fund is its net asset
value, plus, in the case of Class A shares, a sales charge which will vary
depending on the purchase alternative chosen by the investor, as more fully
described in the Prospectus. See "PURCHASE AND REDEMPTION OF SHARES - Class A
Shares - Front-End Sales Charge Alternative." The net asset value per share of
each Class of shares of each Fund is separately computed. On each Fund business
day on which a purchase or redemption order is received by a Fund and trading in
the types of securities in which a Fund invests might materially affect the
value of Fund shares, the per share net asset value of each such Fund is
computed in accordance with the Trust's Declaration of Trust and By-Laws as of
the next close of regular trading on the New York Stock Exchange (the
"Exchange") (currently 4:00 p.m. Eastern time) by dividing the value of the
Fund's total assets, less its liabilities, by the total number of its shares
then outstanding. A Fund business day is any weekday, exclusive of national
holidays on which the Exchange is closed and Good Friday. For each Fund,
securities for which the primary market is on a domestic or foreign exchange and
over-the-counter securities admitted to trading on the NASDAQ National List are
valued at the last quoted sale or, if no sale, at the mean of closing bid and
asked price and portfolio bonds are presently valued by a recognized pricing
service when such prices are

35
<PAGE>

believed to reflect the fair value of the security. Over-the-counter securities
not included in the NASDAQ National List for which market quotations are readily
available are valued at a price quoted by one or more brokers. If accurate
quotations are not available, securities will be valued at fair value determined
in good faith by the Board of Trustees.

The respective per share net asset values of the Class A, Class B,
Class C and Class Y shares are expected to be substantially the same. Under
certain circumstances, however, the per share net asset values of the Class B
and Class C shares may be lower than the per share net asset value of the Class
A shares (and, in turn, that of Class A shares may be lower than Class Y shares)
as a result of the greater daily expense accruals, relative to Class A and Class
Y shares, of Class B and Class C shares relating to distribution services fees
and, to the extent applicable, transfer agency fees and the fact that Class Y
shares bear no additional distribution, shareholder service or transfer agency
related fees. While it is expected that, in the event each Class of shares of a
Fund realizes net investment income or does not realize a net operating loss for
a period, the per share net asset values of the four classes will tend to
converge immediately after the payment of dividends, which dividends will differ
by approximately the amount of the expense accrual differential among the
Classes, there is no assurance that this will be the case. In the event one or
more Classes of a Fund experiences a net operating loss for any fiscal period,
the net asset value per share of such Class or Classes will remain lower than
that of Classes that incurred lower expenses for the period.

To the extent that a Fund invests in non-U.S. dollar denominated
securities, the value of all assets and liabilities not denominated in United
States dollars will be translated into United States dollars at the mean between
the buying and selling rates of the currency in which such a security is
denominated against United States dollars last quoted by any major bank. If
such quotations are not available, the rate of exchange will be determined in
accordance with policies established by the Trust. The Trustees will monitor,
on an ongoing basis, each Fund's method of valuation. Trading in securities on
European and Far Eastern securities exchanges and over-the-counter markets is
normally completed well before the close of business on each business day in New
York. In addition, European or Far Eastern securities trading generally or in a
particular country or countries may not take place on all business days in New
York. Furthermore, trading takes place in various foreign markets on days which
are not business days in New York and on which the Fund's net asset value is not
calculated. Such calculation does not take place contemporaneously with the
determination of the prices of the majority of the portfolio securities used in
such calculation. Events affecting the values of portfolio securities that
occur between the time their prices are determined and the close of the Exchange
will not be reflected in a Fund's calculation of net asset value unless the
Trustees deem that the particular event would materially affect net asset value,
in which case an adjustment will be made. Securities transactions are accounted
for on the trade date, the date the order to buy or sell is executed. Dividend
income and other distributions are recorded on the ex-dividend date, except
certain dividends and distributions from foreign securities which are recorded
as soon as a Fund is informed after the ex-dividend date.

PURCHASE OF SHARES

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<PAGE>

The following information supplements that set forth in the Funds'
Prospectuses under the heading "PURCHASE AND REDEMPTION OF SHARES - How To Buy
Shares."

General

Class Y shares of the Funds are offered on a continuous basis at a
price equal to their net asset value without any front-end, level load or
contingent sales charges. Shares of each Fund will be offered on a continuous
basis at a price equal to their net asset value plus, in the case of Class A
shares, an initial sales charge at the time of purchase (the "front-end sales
charge alternative"), in the case of Class B shares with a contingent deferred
sales charge (the "deferred sales charge alternative"), or, in the case of Class
C shares, without any front-end sales charge, but with a contingent deferred
sales charge imposed only during the first year after purchase (the "level-load
alternative"), as described below. Class A, Class B and Class C shares of each
Fund are offered on a continuous basis through (i) investment dealers that are
members of the National Association of Securities Dealers, Inc. and have entered
into selected dealer agreements with the Distributor ("selected dealers"), (ii)
depository institutions and other financial intermediaries or their affiliates,
that have entered into selected agent agreements with the Distributor ("selected
agents"), or (iii) the Distributor. Investors may purchase Class Y shares of
the Funds at net asset value by mail or wire as described in the Prospectus for
Class Y shares.

The minimum initial investment in each Fund is $1,000; there is no
minimum for subsequent investments. The subscriber may use the Share Purchase
Application available from the Distributor for his or her initial investment.
Sales personnel of selected dealers and agents distributing a Fund's shares may
receive differing compensation for selling Class A, Class B or Class C shares.

Investors may purchase shares of a Fund in the United States either
through selected dealers or agents or directly through the Distributor. A Fund
reserves the right to suspend the sale of its shares to the public in response
to conditions in the securities markets or for other reasons.

Each Fund will accept unconditional orders for its shares to be
executed at the public offering price equal to the net asset value next
determined (plus for Class A shares, the applicable sales charges), as described
below. Orders received by the Distributor prior to the close of regular trading
on the Exchange on each day the Exchange is open for trading are priced at the
net asset value computed as of the close of regular trading on the Exchange on
that day (plus for Class A shares the sales charges). In the case of orders for
purchase of shares placed through selected dealers or agents, the applicable
public offering price will be the net asset value as so determined, but only if
the selected dealer or agent receives the order prior to the close of regular
trading on the Exchange and transmits it to the Distributor prior to its close
of business that same day (normally 5:00 p.m. Eastern time). The selected
dealer or agent is responsible for transmitting such orders by 5:00 p.m. If the
selected dealer or agent fails to do so, the investor's right to that day's
closing price must be settled between the investor and the selected dealer or
agent. If the selected dealer or agent receives the order after the close of
regular trading on the

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<PAGE>

Exchange, the price will be based on the net asset value determined as of the
close of regular trading on the Exchange on the next day it is open for trading.

Alternative Purchase Arrangements

Each Fund issues four classes of shares: (i) Class A shares, which
are sold to investors choosing the front-end sales charge alternative; (ii)
Class B shares, which are sold to investors choosing the deferred sales charge
alternative; (iii) Class C shares, which are sold to investors choosing the
level-load sales charge alternative; and (iv) Class Y shares, which are offered
without any front-end, deferred or level load sales charge. The four classes of
shares of each Fund each represent an interest in the same portfolio of
investments, have the same rights and are identical in all respects, except that
(i) Class A, Class B and Class C shares are subject to a Rule 12b-1 distribution
fee, (ii) Class A shares bear the expense of the front-end sales charge and
Class B and Class C shares bear the expense of the deferred sales charge, (iii)
Class B shares and Class C shares each bear the expense of a higher Rule 12b-1
distribution services fee and shareholder service fee than Class A shares and,
in the case of Class B shares, higher transfer agency costs, (iv) with the
exception of Class Y shares, each Class of each Fund has exclusive voting rights
with respect to provisions of the Rule 12b-1 Plan pursuant to which its
distribution services (and, to the extent applicable, shareholder service) fee
is paid which relates to a specific Class and other matters for which separate
Class voting is appropriate under applicable law, provided that, if the Fund
submits to a simultaneous vote of Class A, Class B and Class C shareholders an
amendment to the Rule 12b-1 Plan that would materially increase the amount to be
paid thereunder with respect to the Class A shares, the Class A shareholders and
the Class B and Class C shareholders will vote separately by Class, and (v) only
the Class B shares are subject to a conversion feature. Each Class has
different exchange privileges and certain different shareholder service options
available.

With respect to Class A, Class B and Class C shares, the alternative
purchase arrangements permit an investor to choose the method of purchasing
shares that is most beneficial given the amount of the purchase, the length of
time the investor expects to hold the shares, and other circumstances.
Investors should consider whether, during the anticipated life of their
investment in the Fund, the accumulated distribution services (and, to the
extent applicable, shareholder service) fee and contingent deferred sales
charges on Class B shares prior to conversion, or the accumulated distribution
services (and, to the extent applicable, shareholder service) fee on Class C
shares, would be less than the front-end sales charge and accumulated
distribution services fee on Class A shares purchased at the same time, and to
what extent such differential would be offset by the higher return of Class A
shares. Class B and Class C shares will normally not be suitable for the
investor who qualifies to purchase Class A shares at the lowest applicable sales
charge. For this reason, the Distributor will reject any order (except orders
for Class B shares from certain retirement plans) for more than $2,500,000 for
Class B shares.

Class A shares are subject to a lower distribution services fee and no
shareholder service fee and, accordingly, pay correspondingly higher dividends
per share than Class B shares or Class C shares. However, because front-end
sales charges are deducted at the time of

38
<PAGE>

purchase, investors purchasing Class A shares would not have all their funds
invested initially and, therefore, would initially own fewer shares. Investors
not qualifying for reduced front-end sales charges who expect to maintain their
investment for an extended period of time might consider purchasing Class A
shares because the accumulated continuing distribution (and, to the extent
applicable, shareholder service) charges on Class B shares or Class C shares may
exceed the front-end sales charge on Class A shares during the life of the
investment. Again, however, such investors must weigh this consideration
against the fact that, because of such front-end sales charges, not all their
funds will be invested initially.

Other investors might determine, however, that it would be more
advantageous to purchase Class B shares or Class C shares in order to have all
their funds invested initially, although remaining subject to higher continuing
distribution services (and, to the extent applicable, shareholder service) fees
and, in the case of Class B shares, being subject to a contingent deferred sales
charge for a six-year period. For example, based on current fees and expenses,
an investor subject to the 4.75% front-end sales charge imposed by the Funds
would have to hold his or her investment approximately seven years for the Class
B and Class C distribution services (and, to the extent applicable, shareholders
service) fees, to exceed the front-end sales charge plus the accumulated
distribution services fee of Class A shares. In this example, an investor
intending to maintain his or her investment for a longer period might consider
purchasing Class A shares. This example does not take into account the time
value of money, which further reduces the impact of the Class B and Class C
distribution services (and, to the extent applicable, shareholder service) fees
on the investment, fluctuations in net asset value or the effect of different
performance assumptions.

Those investors who prefer to have all of their funds invested
initially but may not wish to retain Fund shares for the six year period during
which Class B shares are subject to a contingent deferred sales charge may find
it more advantageous to purchase Class C shares.

With respect to each Fund, the Trustees have determined that currently
no conflict of interest exists between or among the Class A, Class B, Class C
and Class Y shares. On an ongoing basis, the Trustees, pursuant to their
fiduciary duties under the 1940 Act and state laws, will seek to ensure that no
such conflict arises.

Front-end Sales Charge Alternative--Class A Shares

The public offering price of Class A shares for purchasers choosing
the front-end sales charge alternative is the net asset value plus a sales
charge as set forth in the Prospectus for the Class A, Class B and Class C
shares of the Funds.

Shares issued pursuant to the automatic reinvestment of income
dividends or capital gains distributions are not subject to any sales charges.
The Fund receives the entire net asset value of its Class A shares sold to
investors. The Distributor's commission is the sales charge set forth in the
Prospectus, less any applicable discount or commission "reallowed" to selected
dealers and agents. The Distributor will reallow discounts to selected dealers
and agents in the amounts indicated in the table in the Prospectus. In this
regard, the Distributor may elect

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<PAGE>

to reallow the entire sales charge to selected dealers and agents for all sales
with respect to which orders are placed with the Distributor.

Set forth below is an example of the method of computing the offering price
of the Class A shares of each Fund. The example assumes a purchase of Class A
shares of a Fund aggregating less than $100,000 subject to the schedule of sales
charges set forth in the Prospectus at a price based upon the net asset value of
Class A shares of each Fund at the end of each Fund's latest fiscal year.

NET PER SHARE OFFERING PRICE
DATE ASSET VALUE SALES CHARGE PER SHARE

U.S. FUND 9/30/97 $19.34 4.75% $20.30
INTERNATIONAL FUND 10/31/97 $12.94 4.75% $13.59

Prior to January 3, 1995, shares of the Funds were offered exclusively
on a no-load basis and, accordingly, no underwriting commissions were paid in
respect of sales of shares of the Fund or retained by the Distributor. In
addition, since Class B and Class C shares were not offered prior to January 3,
1995, contingent deferred sales charges have been paid to the Distributor with
respect to Class B or Class C shares only since January 3, 1995.

With respect to the U.S. Fund, the following commissions were paid to
and amounts retained by the Distributor for the fiscal years ended September 30,
1996 and September 30, 1997 and for the period from January 3, 1995 through
September 30, 1995:

YEAR ENDED YEAR ENDED YEAR ENDED
U.S. FUND 9/30/97 9/30/96 9/30/95

Commissions Received $98,931 $4,724 $118

Commissions Retained 12,004 543 13

With respect to the International Fund, the following commissions were
paid to and amounts were retained by the Distributor for the period from
February 10, 1995, February 8, 1995 and February 9, 1995 (the commencement of
operations of Class A, Class B and Class C shares, respectively) through October
31, 1995, and the fiscal years ended October 31, 1996 and October 31, 1997:

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<PAGE>

YEAR ENDED YEAR ENDED ONE MONTH YEAR ENDED
INTERNATIONAL FUND 10/31/97 10/31/96 ENDED 10/31/95 9/30/95

Commissions Received $79,763 $5,823 $514 $47
Commissions Retained 3,658 664 59 6

Investors choosing the front-end sales charge alternative may under
certain circumstances be entitled to pay reduced sales charges. The
circumstances under which such investors may pay reduced sales charges are
described below.

COMBINED PURCHASE PRIVILEGE. Certain persons may qualify for the
sales charge reductions by combining purchases of Class A shares of both Funds
into a single "purchase", if the resulting "purchase" totals at least $100,000.
The term "purchase" refers to: (i) a single purchase by an individual, or to
concurrent purchases, which in the aggregate are at least equal to the
prescribed amounts, by an individual, his or her spouse and their children under
the age of 21 years purchasing shares for his, her or their own account(s); (ii)
a single purchase by a trustee or other fiduciary purchasing shares for a single
trust, estate or single fiduciary account although more than one beneficiary is
involved; or (iii) a single purchase for the employee benefit plans of a single
employer. The term "purchase" also includes purchases by any "company", as the
term is defined in the 1940 Act, but does not include purchases by any such
company which has not been in existence for at least six months or which has no
purpose other than the purchase of shares of a Fund or shares of other
registered investment companies at a discount. The term "purchase" does not
include purchases by any group of individuals whose sole organizational nexus is
that the participants therein are credit card holders of a company, policy
holders of an insurance company, customers of either a bank or broker-dealer or
clients of an investment adviser.

A "purchase" may also include shares purchased at the same time
through a single selected dealer or agent, of the Funds.

CUMULATIVE QUANTITY DISCOUNT (RIGHT OF ACCUMULATION). An investor's
purchase of additional Class A shares of a Fund may qualify for a Cumulative
Quantity Discount. The applicable sales charge will be based on the total of:

(i) the investor's current purchase;

(ii) the net asset value (at the close of business on the
previous day) of (a) all Class A, Class B and Class C shares
of the Fund held by the investor and (b) all such shares of
the other Fund held by the investor; and

(iii) the net asset value of all shares described in paragraph
(ii) owned by another shareholder eligible to combine his or
her purchase with that of the investor into a single
"purchase" (see above).

For example, if an investor owned Class A, Class B or Class C shares
of the U.S. Fund worth $200,000 at their then current net asset value and,
subsequently, purchased Class A

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<PAGE>

shares of the International Fund worth an additional $100,000, the sales charge
for the $100,000 purchase would be the 2.50% rate applicable to a single
$300,000 purchase of shares of the Fund, rather than the 3.75% rate.

To qualify for the Combined Purchase Privilege or to obtain the
Cumulative Quantity Discount on a purchase through a selected dealer or agent,
the investor or selected dealer or agent must provide the Distributor with
sufficient information to verify that the purchase qualifies for the privilege
or discount.

STATEMENT OF INTENTION. Class A investors may also obtain the reduced
sales charges shown in the Prospectus by means of a written Statement of
Intention, which expresses the investor's intention to invest not less than
$100,000 within a period of 13 months in Class A shares (or Class A, Class B
and/or Class C shares) of the Funds. Each purchase of shares under a Statement
of Intention will be made at the public offering price or prices applicable at
the time of such purchase to a single transaction of the dollar amount indicated
in the Statement of Intention. At the investor's option, a Statement of
Intention may include purchases of Class A, Class B, or Class C shares of the
Funds made not more than 90 days prior to the date that the investor signs a
Statement of Intention; however, the 13-month period during which the Statement
of Intention is in effect will begin on the date of the earliest purchase to be
included.

Investors qualifying for the Combined Purchase Privilege described
above may purchase shares of the Funds under a single Statement of Intention.
For example, if at the time an investor signs a Statement of Intention to invest
at least $100,000 in Class A shares of a Fund, the investor and the investor's
spouse each purchase shares of the Fund worth $20,000 (for a total of $40,000),
it will only be necessary to invest a total of $60,000 during the following 13
months in shares of the Fund and shares of the other Fund, to qualify for the
3.75% sales charge applicable to purchases in the Funds on the total amount
being invested (the sales charge applicable to an investment of $100,000).

The Statement of Intention is not a binding obligation upon the
investor to purchase the full amount indicated. The minimum initial investment
under a Statement of Intention is 5% of such amount. Shares purchased with the
first 5% of such amount will be held in escrow (while remaining registered in
the name of the investor) to secure payment of the higher sales charge
applicable to the shares actually purchased if the full amount indicated is not
purchased, and such escrowed shares will be involuntarily redeemed to pay the
additional sales charge, if necessary. Dividends on escrowed shares, whether
paid in cash or reinvested in additional Fund shares, are not subject to escrow.
When the full amount indicated has been purchased, the escrow will be released.
To the extent that an investor purchases more than the dollar amount indicated
on the Statement of Intention and qualifies for a further reduced sales charge,
the sales charge will be adjusted for the entire amount purchased at the end of
the 13-month period. The difference in sales charge will be used to purchase
additional shares of the Fund subject to the rate of sales charge applicable to
the actual amount of the aggregate purchases.

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<PAGE>

Investors wishing to enter into a Statement of Intention in
conjunction with their initial investment in Class A shares of a Fund should
complete the appropriate portion of the Share Purchase Application. Current
Class A shareholders desiring to do so can obtain a form of Statement of
Intention by contacting a Fund at the address or telephone number shown on the
cover of this Statement of Additional Information.

INVESTMENTS THROUGH EMPLOYEE BENEFIT AND SAVINGS PLANS. Certain
qualified and non-qualified benefit and savings plans may make shares of the
Funds available to their participants. Investments made by such employee
benefit plans may be exempt from any applicable front-end sales charges if they
meet the criteria set forth in the Prospectus under "Class A Shares-Front End
Sales Charge Alternative". The Adviser may pay compensation to organizations
providing administrative and record keeping services to plans which make shares
of the Funds available to their participants.

REINSTATEMENT PRIVILEGE. A Class A shareholder who has caused any or
all of his or her shares of a Fund to be redeemed or repurchased may reinvest
all or any portion of the redemption or repurchase proceeds in Class A shares of
the Fund at net asset value without any sales charge, provided that such
reinvestment is made within 30 calendar days after the redemption or repurchase
date. Shares are sold to a reinvesting shareholder at the net asset value next
determined as described above. A reinstatement pursuant to this privilege will
not cancel the redemption or repurchase transaction; therefore, any gain or loss
so realized will be recognized for Federal income tax purposes, except that no
loss will be recognized to the extent that the proceeds are reinvested in shares
of the Fund. The reinstatement privilege may be used by the shareholder only
once, irrespective of the number of shares redeemed or repurchased, except that
the privilege may be used without limit in connection with transactions whose
sole purpose is to transfer a shareholder's interest in the Fund to his or her
individual retirement account or other qualified retirement plan account.
Investors may exercise the reinstatement privilege by written request sent to
the Fund at the address shown on the cover of this Statement of Additional
Information.

SALES AT NET ASSET VALUE. As noted above, Class Y shares of the Funds
may be purchased at their net asset value without any front-end, deferred or
level load sales charge.

With respect to Class A shares, in addition to the categories of
investors set forth in the Prospectus, each Fund may sell its Class A shares at
net asset value, i.e., without any sales charge, to: (i) certain investment
advisory clients of the Adviser or its affiliates; (ii) officers and present or
former Trustees of the Trust; present or former trustees of other investment
companies managed by the Adviser; officers, directors and present or retired,
full-time employees of the Adviser, the Distributor, and their affiliates;
officers, directors and present and full-time employees of selected dealers or
agents; or the spouse, sibling, direct ancestor or direct descendant
(collectively "relatives") of any such person; or any trust, individual
retirement account or retirement plan account for the benefit of any such person
or relative; or the estate of any such person or relative, if such shares are
purchased for investment purposes (such shares may not be resold except to the
Fund); (iii) certain employee benefit plans for employees of the Adviser, the
Distributor and their affiliates; (iv) persons participating in a fee-based
program,

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<PAGE>

sponsored and maintained by a registered broker-dealer and approved by the
Distributor, pursuant to which such persons pay an asset based fee to such
broker-dealer, or its affiliate or agent, for service in the nature of
investment advisory or administrative services. These provisions are intended
to provide additional job-related incentives to persons who serve the Funds or
work for companies associated with the Funds and selected dealers and agents of
the Funds. Since these persons are in a position to have a basic understanding
of the nature of an investment company as well as a general familiarity with the
Fund, sales to these persons, as compared to sales in the normal channels of
distribution, require substantially less sales effort. Similarly, these
provisions extend the privilege of purchasing shares at net asset value to
certain classes of institutional investors who, because of their investment
sophistication, can be expected to require significantly less than normal sales
effort on the part of the Funds and the Distributor.

Deferred Sales Charge Alternative--Class B Shares

Investors choosing the deferred sales charge alternative purchase
Class B shares at the public offering price equal to the net asset value per
share of the Class B shares on the date of purchase without the imposition of a
sales charge at the time of purchase. The Class B shares are sold without a
front-end sales charge so that the full amount of the investor's purchase
payment is invested in the Fund initially.

Proceeds from the contingent deferred sales charge are paid to the
Distributor and are used by the Distributor to defray the expenses of the
Distributor related to providing distribution-related services to the Fund in
connection with the sale of the Class B shares, such as the payment of
compensation to selected dealers and agents for selling Class B shares. The
combination of the contingent deferred sales charge and the distribution
services fee enables the Fund to sell the Class B shares without a sales charge
being deducted at the time of purchase. The higher distribution services fee
incurred by Class B shares will cause such shares to have a higher expense ratio
and to pay lower dividends than those related to Class A shares.

CONTINGENT DEFERRED SALES CHARGE. Class B shares which are redeemed
within six years of purchase will be subject to a contingent deferred sales
charge at the rates set forth in the Prospectus charged as a percentage of the
dollar amount subject thereto. The charge will be assessed on an amount equal
to the lesser of the cost of the shares being redeemed or their net asset value
at the time of redemption. Accordingly, no sales charge will be imposed on
increases in net asset value above the initial purchase price. In addition, no
contingent deferred sales charge will be assessed on shares derived from
reinvestment of dividends or capital gains distributions. The amount of the
contingent deferred sales charge, if any, will vary depending on the number of
years from the time of payment for the purchase of Class B shares until the time
of redemption of such shares.

In determining the contingent deferred sales charge applicable to a
redemption it will be assumed that the redemption is first of any Class A shares
or Class C shares in the shareholder's Fund account, second of Class B shares
held for over six years or Class B shares acquired pursuant to reinvestment of
dividends or distributions and third of Class B shares held longest during the
six-year period.

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<PAGE>

To illustrate, assume that an investor purchased 100 Class B shares at
$10 per share (at a cost of $1,000) and in the second year after purchase, the
net asset value per share is $12 and, during such time, the investor has
acquired 10 additional Class B shares upon dividend reinvestment. If at such
time the investor makes his or her first redemption of 50 Class B shares, 10
Class B shares will not be subject to charge because of dividend reinvestment.
With respect to the remaining 40 Class B shares, the charge is applied only to
the original cost of $10 per share and not to the increase in net asset value of
$2 per share. Therefore, of the $600 of the shares redeemed $400 of the
redemption proceeds (40 shares x $10 original purchase price) will be charged at
a rate of 4.0% (the applicable rate in the second year after purchase for a
contingent deferred sales charge of $16).

The contingent deferred sales charge is waived on redemptions of
shares (i) following the death or disability, as defined in the Code, of a
shareholder, or (ii) to the extent that the redemption represents a minimum
required distribution from an individual retirement account or other retirement
plan to a shareholder who has attained the age of 70-1/2.

CONVERSION FEATURE. At the end of the period ending six years after
the end of the calendar month in which the shareholder's purchase order was
accepted, Class B shares will automatically convert to Class A shares and will
no longer be subject to a higher distribution services fee imposed on Class B
shares. Such conversion will be on the basis of the relative net asset values
of the two classes, without the imposition of any sales load, fee or other
charge. The purpose of the conversion feature is to reduce the distribution
services fee paid by holders of Class B shares that have been outstanding long
enough for the Distributor to have been compensated for the expenses associated
with the sale of such shares.

For purposes of conversion to Class A, Class B shares purchased
through the reinvestment of dividends and distributions paid in respect of Class
B shares in a shareholder's account will be considered to be held in a separate
sub-account. Each time any Class B shares in the shareholder's account (other
than those in the sub-account) convert to Class A, an equal pro-rata portion of
the Class B shares in the sub-account will also convert to Class A.

The conversion of Class B shares to Class A shares is subject to the
continuing availability of an opinion of counsel to the effect that (i) the
assessment of the higher distribution services fee and transfer agency costs
with respect to Class B shares does not result in the dividends or distributions
payable with respect to other Classes of a Fund's shares being deemed
"preferential dividends" under the Code, and (ii) the conversion of Class B
shares to Class A shares does not constitute a taxable event under Federal
income tax law. The conversion of Class B shares to Class A shares may be
suspended if such an opinion is no longer available at the time such conversion
is to occur. In that event, no further conversions of Class B shares would
occur, and shares might continue to be subject to the higher distribution
services fee for an indefinite period which may extend beyond the period ending
six years after the end of the calendar month in which the shareholder's
purchase order was accepted.

Level-Load Alternative--Class C Shares

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<PAGE>

Investors choosing the level load sales charge alternative purchase
Class C shares at the public offering price equal to the net asset value per
share of the Class C shares on the date of purchase without the imposition of a
front-end sales charge. However, you will pay a 1.0% contingent deferred sales
charge if you redeem shares during the first year after purchase. No charge is
imposed in connection with redemptions made more than one year from the date of
purchase. Class C shares are sold without a front-end sales charge so that the
Fund will receive the full amount of the investor's purchase payment and after
the first year without a contingent deferred sales charge so that the investor
will receive as proceeds upon redemption the entire net asset value of his or
her Class C shares. The Class C distribution services fee enables the Fund to
sell Class C shares without either a front-end or contingent deferred sales
charge. However, unlike Class B shares, Class C shares do not convert to any
other class shares of the Fund. Class C shares incur higher distribution
services than Class A shares, and will thus have a higher expense ratio and pay
correspondingly lower dividends than Class A shares.

Class Y Shares

Class Y shares do not bear any Rule 12b-1 distribution expenses and
are not subject to any front-end or contingent deferred sales charges.

GENERAL INFORMATION ABOUT THE FUNDS

(See also "GENERAL INFORMATION" in the Funds' Prospectuses)

Capitalization and Organization

The Funds are each separate series of Alpine Equity Trust, a
Massachusetts business trust. The Trust is governed by its Board of Trustees.
The Funds may issue an unlimited number of shares of beneficial interest with a
$0.0001 par value. All shares of the Funds have equal rights and privileges.
Each share of each Class is entitled to one vote on all matters as to which
shares of such Class are entitled to vote, to participate equally in dividends
and distributions declared by the Funds and on liquidation to their
proportionate share of the assets remaining after satisfaction of outstanding
liabilities. Shares of the Funds are fully paid, non-assessable and fully
transferable when issued and have no pre-emptive, conversion or exchange rights.
Fractional shares have proportionally the same rights, including voting rights,
as are provided for a full share.

On February __, 1998, in connection with the acquisition of certain
of those assets of Evergreen Asset Management that relate to the management of
the Funds by the Adviser, the names of the Trust and the Funds where changed
from Evergreen Equity Trust, Evergreen U.S. Real Estate Equity Fund and
Evergreen Global Real Estate Equity Fund.

Under the Trust's Declaration of Trust, each Trustee will continue in
office until the termination of the Trust or his or her earlier death,
incapacity, resignation or removal. Shareholders can remove a Trustee upon a
vote of two-thirds of the outstanding shares of beneficial interest of the
Trust. Vacancies may be filled by a majority of the remaining Trustees, except
insofar as the 1940 Act may require the election by shareholders. As a result,
normally no

46
<PAGE>

annual or regular meetings of shareholders will be held, unless otherwise
required by the Declaration of Trust or the 1940 Act.

Shares have noncumulative voting rights, which means that the holders
of more than 50% of the shares voting for the election of Trustees can elect
100% of the Trustees if they choose to do so and in such event the holders of
the remaining shares so voting will not be able to elect any Trustees.

The Trustees are authorized to classify and reclassify any issued
class of shares of a Fund into shares of one or more classes of the Fund and to
reclassify and issue any unissued shares to any number of additional series
without shareholder approval. Accordingly, in the future, for reasons such as
the desire to establish one or more additional portfolios of the Trust with
different investment objectives, policies or restrictions, additional series or
classes of shares may be created. Any issuance of shares of another series or
class would be governed by the 1940 Act and the law of the Commonwealth of
Massachusetts. If shares of another series of the Trust were issued in
connection with the creation of additional investment portfolios, each share of
the newly created portfolio would normally be entitled to one vote for all
purposes. Generally, shares of all portfolios, including the Funds, would vote
as a single series on matters, such as the election of Trustees, that affected
all portfolios in substantially the same manner. As to matters affecting each
portfolio differently, such as approval of the Investment Advisory Agreement and
changes in investment policy, shares of each portfolio would vote separately.

In addition the Trustees may, in the future, create additional classes
of shares of the Funds. Except for the different distribution related and other
specific costs borne by such additional classes, they will have the same voting
and other rights described for the existing classes of each Fund.

Procedures for calling a shareholders meeting for the removal of the
Trustees of each Trust, similar to those set forth in Section 16(c) of the 1940
Act, will be available to shareholders of each Fund. The rights of the holders
of shares of a series of a Trust may not be modified except by the vote of a
majority of the outstanding shares of such series.

Distributor

Evergreen Keystone Distributor, Inc., 120 Clove Road, Little Falls,
New Jersey 07424, serves as each Fund's principal underwriter, and as such may
solicit orders from the public to purchase shares of the Funds. The Distributor
is not obligated to sell any specific amount of shares and will purchase shares
for resale only against orders for shares. Under the Agreement between the Fund
and the Distributor, the Fund has agreed to indemnify the Distributor, in the
absence of its willful misfeasance, bad faith, gross negligence or reckless
disregard of its obligations thereunder, against certain civil liabilities,
including liabilities under the 1933 Act.

Counsel

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Schulte Roth & Zabel LLP, 900 Third Avenue, New York, New York, serves
as counsel to the Trust.

Independent Auditors

Price Waterhouse LLP has been selected to be the independent auditors
of the Funds.

PERFORMANCE INFORMATION

Total Return

From time to time a Fund may advertise its "total return". Computed
separately for each class, a Fund's "total return" is its average annual
compounded total return for recent one, five, and ten-year periods (or the
period since the Fund's inception). A Fund's total return for such a period is
computed by finding, through the use of a formula prescribed by the SEC, the
average annual compounded rate of return over the period that would equate an
assumed initial amount invested to the value of such investment at the end of
the period. For purposes of computing total return, income dividends and
capital gains distributions paid on shares of the Fund are assumed to have been
reinvested when paid and the maximum sales charge applicable to purchases of
Fund shares is assumed to have been paid.

The shares of the Funds outstanding prior to January 3, 1995, have
been reclassified as Class Y shares. Set forth in the table below is the
average annual compounded total return for each Class of shares offered by the
Funds (including applicable sales charges) for the most recently completed one,
three and five year fiscal periods and/or the period from inception through
September 30, 1997 for the U.S. Fund and through October 31, 1997 for the
International Fund.

U.S. Fund:

ONE YEAR THREE YEARS FIVE YEARS SINCE INCEPTION INCEPTION DATE
- --------------------------------------------------------------------------------
Class A 69.81% - - 40.28% Mar. 10, 1995
Class B 71.87% - - 41.25% Mar. 7, 1995
Class C 75.89% - - 39.24% July 12, 1995
Class Y 78.79% 33.65% - 24.09% Sept. 1, 1993

International Fund:

ONE YEAR THREE YEARS FIVE YEARS SINCE INCEPTION INCEPTION DATE
- --------------------------------------------------------------------------------
Class A 0.37% - - 2.71% Feb. 10, 1995
Class B (0.47)% - - 2.83% Feb. 8, 1995
Class C 3.61% - - 3.94% Feb. 9, 1995
Class Y 5.54% 0.41% 9.08% 4.24% Feb. 1, 1989

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<PAGE>

Except for the one year ended October 31, 1997, the performance
numbers for the Funds for the Class A, Class B and Class C shares are
hypothetical numbers based on the performance for Class Y shares as adjusted for
any applicable front-end sales charge contingent deferred sales charge.

A Fund's quotations of total return reflect the average annual
compounded rate of return on an assumed investment of $1,000 that equates the
initial amount invested to the ending redeemable value according to the
following formula:

n
P (1 + T) = ERV

where "P" represents a hypothetical initial investment of $1,000; "T" represents
average annual total return; "n" represents the number of years; and "ERV"
represents the ending redeemable value of the initial investment. Dividends and
other distributions are assumed to be reinvested in shares at the prices in
effect on the reinvestment dates. ERV will be adjusted to reflect the effect of
any agreement by the Adviser to waive its fees or to absorb certain expenses of
a Fund. Quotations of total return will be for one year, five year and ten year
periods ended on the date of the most recent balance sheet included in the
Trust's registration statement at such times as the registration statement has
been in effect for such periods. Until such time as the registration statement
has been effective for the one year, five year and ten year periods, a Fund's
quotations of total return will also include a quotation of total return for the
time period during which the registration statement has been in effect or the
time period since the commencement of operations, whichever period begins later.
The Funds may also provide quotations of total return for other periods and
quotations of cumulative total returns, which reflect the actual performance of
a Fund over the entire period for which the quotation is given.

A Fund's total return is not fixed and will fluctuate in response to
prevailing market conditions or as a function of the type and quality of the
securities in its portfolio and its expenses. Total return information is
useful in reviewing a Fund's performance but such information may not provide a
basis for comparison with bank deposits or other investments which pay a fixed
yield for a stated period of time. An investor's principal invested in a Fund
is not fixed and will fluctuate in response to prevailing market conditions.

Non-Standardized Performance

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

GENERAL

From time to time, a Fund may quote its performance in advertising and
other types of literature as compared to the performance of the Standard &
Poor's 500 Composite

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<PAGE>

Stock Price Index, the Dow Jones Industrial Average, Russell 2000 Index, Europe,
Australia and Far East index, Morgan Stanley Capital International Equity
Emerging Markets Free Index or any other commonly quoted index of common stock
prices, which are unmanaged indices of selected common stock prices. A Fund's
performance may also be compared to those of other mutual funds having similar
objectives. This comparative performance would be expressed as a ranking
prepared by Lipper Analytical Services, Inc. or similar independent services
monitoring mutual fund performance. A Fund's performance will be calculated by
assuming, to the extent applicable, reinvestment of all capital gains
distributions and income dividends paid. Any such comparisons may be useful to
investors who wish to compare a Fund's past performance with that of its
competitors. Of course, past performance cannot be a guarantee of future
results.

Additional Information

All shareholder inquiries may be directed to the shareholder's broker,
or may be directed to the Funds at the address or telephone number shown on the
front cover of this Statement of Additional Information. This Statement of
Additional Information does not contain all the information set forth in the
Registration Statements filed by the Trust with the SEC under the 1933 Act.
Copies of the Registration Statements may be obtained at a reasonable charge
from the SEC or may be examined, without charge, at the offices of the SEC in
Washington, D.C.

FINANCIAL STATEMENTS

Each Fund's financial statements appearing in its most current fiscal
year Annual Report to shareholders and the report thereon of Price Waterhouse
LLP, the Funds' independent auditors appearing therein, are incorporated by
reference in this Statement of Additional Information. The Annual Reports to
Shareholders for each Fund, which contain the referenced statements, are
available upon request and without charge.

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<PAGE>

APPENDIX "A"

DESCRIPTION OF BOND RATINGS

Standard & Poor's Ratings Group. A Standard & Poor's corporate bond
rating is a current assessment of the credit worthiness of an obligor with
respect to a specific obligation. This assessment of credit worthiness may take
into consideration obligors, such as guarantors, insurers or lessees. The debt
rating is not a recommendation to purchase, sell or hold a security, inasmuch as
it does not comment as to market price or suitability for a particular investor.

The ratings are based on current information furnished to Standard &
Poor's by the issuer or obtained by Standard & Poor's from other sources it
considers reliable. Standard & Poor's does not perform any audit in connection
with the ratings and may, on occasion, rely on unaudited financial information.
The ratings may be changed, suspended or withdrawn as a result of changes in,
unavailability of such information, or for other circumstances.

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

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

2. Nature of and provisions of the obligation.

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

AAA - This is the highest rating assigned by Standard & Poor's to a
debt obligation and indicates an extremely strong capacity to pay interest and
repay any principal.

AA - Debt rated AA also qualifies as high quality debt obligations.
Capacity to pay interest and repay principal is very strong and in the majority
of instances they differ from AAA issues only in small degree.

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

BBB - Debt rated BBB is regarded as having an adequate capacity to pay
interest and repay principal. Whereas they normally exhibit protection
parameters, adverse economic conditions or changing circumstances are more
likely to lead to a weakened capacity to pay interest and repay principal for
debt in this category than in higher rated categories.

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<PAGE>

BB, B, CCC, CC, C - Debt rated BB, B, CCC, CC and C is regarded, on a
balance, as predominantly speculative with respect to capacity to pay interest
and repay principal in accordance with the terms of the obligation.

BB indicates the lowest degree of speculation and C the highest degree
of speculation. While such debt will likely have some quality and protective
characteristics, these are outweighed by large uncertainties or major risk
exposures to adverse conditions.

BB - Debt rated BB has less near-term vulnerability to default than
other speculative issues. However, it faces major ongoing uncertainties or
exposure to adverse business, financial, or economic conditions which could lead
to inadequate capacity to meet timely interest and principal payments. The BB
rating category is also used for debt subordinated to senior debt that is
assigned an actual or implied BBB rating.

B - Debt rated B has greater vulnerability to default but currently
has the capacity to meet interest payments and principal repayments. Adverse
business, financial, or economic conditions will likely impair capacity or
willingness to pay interest and repay principal. The B rating category is also
used for debt subordinated to senior debt that is assigned an actual or implied
BB or BB- rating.

CCC - Debt rated CCC has a currently indefinable vulnerability to
default, and is dependent upon favorable business, financial and economic
conditions to meet timely payment of interest and repayment of principal. In
the event of adverse business, financial or economic conditions, it is not
likely to have the capacity to pay interest and repay principal. The CCC rating
category is also used for debt subordinated to senior debt that is assigned an
actual or implied B or B- rating.

CC - The rating CC is typically applied to debt subordinated to senior
debt that is assigned an actual or implied CCC rating.

C - The rating C is typically applied to debt subordinated to senior
debt which is assigned an actual or implied CCC- debt rating. The C rating may
be used to cover a situation where a bankruptcy petition has been filed, but
debt service payments are continued.

C1 - The rating C1 is reserved for income bonds on which no interest
is being paid.

D - Debt rated D is in payment default. It is used when interest
payments or principal payments are not made on a due date even if the applicable
grace period has not expired, unless Standard & Poor's believes that such
payments will be made during such grace periods; it will also be used upon a
filing of a bankruptcy petition if debt service payments are jeopardized.

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

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<PAGE>

NR - indicates that no public rating has been requested, that there is
insufficient information on which to base a rating, or that Standard & Poor's
does not rate a particular type of obligation as a matter of policy. Debt
obligations of issuers outside the United States and its territories are rated
on the same basis as domestic corporate issues. The ratings measure the credit
worthiness of the obligor but do not take into account currency exchange and
related uncertainties.

Bond Investment Quality Standards: Under present commercial bank
regulations issued by the Comptroller of the Currency, bonds rated in the top
four categories (AAA, AA, A, BBB, commonly known as "Investment Grade" ratings)
are generally regarded as eligible for bank investment. In addition, the Legal
Investment Laws of various states may impose certain rating or other standards
for obligations eligible for investment by savings banks, trust companies,
insurance companies and fiduciaries generally.

Moody's Investors Service, Inc. A brief description of the applicable
Moody's rating symbols and their meanings follows:

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

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

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

Baa - Bonds which are rated Baa are considered as medium grade
obligations, i.e., they are neither highly protected nor poorly secured.
Interest payments and principal security appear adequate for the present but
certain protective elements may be lacking or may be characteristically
unreliable over any great length of time. Some bonds lack outstanding
investment characteristics and in fact have speculative characteristics as well.
NOTE: Bonds within the above categories which possess the strongest investment
attributes are designated by the symbol "1" following the rating.

Ba - Bonds which are rated Ba are judged to have speculative elements;
their future cannot be considered as well assured. Often the protection of
interest and principal

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<PAGE>

payments may be very moderate and thereby not well safeguarded during good and
bad times over the future. Uncertainty of position characterizes bonds in this
class.

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

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

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

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

Duff & Phelps, Inc.: AAA-- highest credit quality, with negligible
risk factors; AA -- high credit quality, with strong protection factors and
modest risk, which may vary very slightly from time to time because of economic
conditions; A-- average credit quality with adequate protection factors, but
with greater and more variable risk factors in periods of economic stress. The
indicators "+" and "-" to the AA and A categories indicate the relative position
of a credit within those rating categories.

Fitch Investors Service LLP.: AAA -- highest credit quality, with an
exceptionally strong ability to pay interest and repay principal; AA -- very
high credit quality, with very strong ability to pay interest and repay
principal; A -- high credit quality, considered strong as regards principal and
interest protection, but may be more vulnerable to adverse changes in economic
conditions and circumstances. The indicators "+" and "-" to the AA, A and BBB
categories indicate the relative position of credit within those rating
categories.

DESCRIPTION OF NOTE RATINGS

A Standard & Poor's note rating reflects the liquidity concerns and
market access risks unique to notes. Notes due in three years or less will
likely receive a note rating. Notes maturing beyond three years will most
likely receive a long-term debt rating. The following criteria will be used in
making that assessment.

- Amortization schedule (the larger the final maturity relative to
other maturities the more likely it will be treated as a note).

- Source of Payment (the more dependent the issue is on the market
for its refinancing, the more likely it will be treated as a
note.) Note rating symbols are as follows:

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<PAGE>

- SP-1 Very strong or strong capacity to pay principal and
interest. Those issues determined to possess overwhelming safety
characteristics will be given a plus (+) designation.

- SP-2 Satisfactory capacity to pay principal and interest.

- SP-3 Speculative capacity to pay principal and interest.

Moody's Short-Term Loan Ratings - Moody's ratings for state and
municipal short-term obligations will be designated Moody's Investment Grade
(MIG). This distinction is in recognition of the differences between short-term
credit risk and long-term risk. Factors affecting the liquidity of the borrower
are uppermost in importance in short-term borrowing, while various factors of
major importance in bond risk are of lesser importance over the short run.
Rating symbols and their meanings follow:

- MIG 1 - This designation denotes best quality. There is present
strong protection by established cash flows, superior liquidity
support or demonstrated broad-based access to the market for
refinancing.

- MIG 2 - This designation denotes high quality. Margins of
protection are ample although not so large as in the preceding
group.

- MIG 3 - This designation denotes favorable quality. All security
elements are accounted for but this is lacking the undeniable
strength of the preceding grades. Liquidity and cash flow
protection may be narrow and market access for refinancing is
likely to be less well established.

- MIG 4 - This designation denotes adequate quality. Protection
commonly regarded as required of an investment security is
present and although not distinctly or predominantly speculative,
there is specific risk.

COMMERCIAL PAPER RATINGS

Moody's Investors Service, Inc.: Commercial paper rated "Prime"
carries the smallest degree of investment risk. The modifiers 1, 2, and 3 are
used to denote relative strength within this highest classification.

Standard & Poor's Ratings Group: "A" is the highest commercial paper
rating category utilized by Standard & Poor's Ratings Group which uses the
numbers 1+, 1, 2 and 3 to denote relative strength within its "A"
classification.

Duff & Phelps Inc.: Duff 1 is the highest commercial paper rating
category utilized by Duff & Phelps which uses + or - to denote relative strength
within this classification.

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Duff 2 represents good certainty of timely payment, with minimal risk factors.
Duff 3 represents satisfactory protection factors, with risk factors larger and
subject to more variation.

Fitch Investors Service LLP.: F-1+ -- denotes exceptionally strong
credit quality given to issues regarded as having strongest degree of assurance
for timely payment; F-1 -- very strong, with only slightly less degree of
assurance for timely payment than F-1+; F-2 -- good credit quality, carrying a
satisfactory degree of assurance for timely payment.

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APPENDIX "B"

FUTURES AND OPTIONS

The following information should be read in conjunction with the
discussions of options and futures in the Funds' Prospectuses and elsewhere in
this Statement of Additional Information.

OPTIONS ON SECURITIES

An option on a security provides the purchaser, or "holder," with the
right, but not the obligation, to purchase, in the case of a "call" option, or
sell, in the case of a "put" option, the security or securities underlying the
option, for a fixed exercise price up to a stated expiration date. The holder
pays a non-refundable purchase price for the option, known as the "premium."
The maximum amount of risk the purchaser of the option assumes is equal to the
premium plus related transaction costs, although the entire amount may be lost.
The risk of the seller, or "writer," however, is potentially unlimited, unless
the option is "covered," which is generally accomplished through the writer's
ownership of the underlying security, in the case of a call option, or the
writer's segregation of an amount of cash or securities equal to the exercise
price, in the case of a put option. If the writer's obligation is not covered,
it is subject to the risk of the full change in value of the underlying security
from the time the option is written until exercise.

Upon exercise of the option, the holder is required to pay the
purchase price of the underlying security, in the case of a call option, or to
deliver the security in return for the purchase price, in the case of a put
option. Conversely, the writer is required to deliver the security, in the case
of a call option, or to purchase the security, in the case of a put option.
Options on securities which have been purchased or written may be closed out
prior to exercise or expiration by entering into an offsetting transaction on
the exchange on which the initial position was established, subject to the
availability of a liquid secondary market.

Options on securities and options on indices of securities, discussed
below, are traded on national securities exchanges, such as the Chicago Board
Options Exchange and the New York Stock Exchange, which are regulated by the
Securities and Exchange Commission. The Options Clearing Corporation guarantees
the performance of each party to an exchange-traded option, by in effect taking
the opposite side of each such option. Options on securities and indices
purchased and written by the Portfolios may be traded on NASDAQ rather than on
an exchange. Any options not traded on an exchange must be effected with
primary government securities dealers recognized by the Board of Governors of
the Federal Reserve System.

An option position in an exchange traded option may be closed out only
on an exchange which provides a secondary market for an option of the same
series. Although the Funds will generally purchase or write only those options
for which there appears to be an active secondary market, there is no assurance
that a liquid secondary market on an exchange will exist for any particular
option at any particular time. In such event it might not be possible to effect
closing transactions in a particular option with the result that the Funds would
have to exercise

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the option in order to realize any profit. This would result in the Funds
incurring brokerage commissions upon the disposition of underlying securities
acquired through the exercise of a call option or upon the purchase of
underlying securities upon the exercise of a put option. If the Funds as
covered call option writers are unable to effect a closing purchase transaction
in a secondary market, unless the Funds are required to deliver the stock
pursuant to the assignment of an exercise notice, they will not be able to sell
the underlying security until the option expires.

Reasons for the potential absence of a liquid secondary market on an
exchange include the following: (i) there may be insufficient trading interest
in certain options; (ii) restrictions may be imposed by an exchange on opening
transactions or closing transactions or both; (iii) trading halts, suspensions
or other restrictions may be imposed with respect to particular classes or
series of options or underlying securities; (iv) unusual or unforeseen
circumstances may interrupt normal operations on an exchange; (v) the facilities
of an exchange or a clearing corporation may not at all times be adequate to
handle current trading volume or (vi) one or more exchanges could, for economic
or other reasons decide or be compelled at some future date to discontinue the
trading of options (or a particular class or series of options) in which event
the secondary market on that exchange (or in the class or series of options)
would cease to exist, although outstanding options on that exchange which had
been issued by a clearing corporation as a result of trades on that exchange
would continue to be exercisable in accordance with their terms. There is no
assurance that higher than anticipated trading activity or other unforeseen
events might not, at a particular time, render certain of the facilities of any
of the clearing corporations inadequate and thereby result in the institution by
an exchange of special procedures which may interfere with the timely execution
of customers' orders. However, the Options Clearing Corporation, based on
forecasts provided by the U.S. exchanges, believes that its facilities are
adequate to handle the volume of reasonably anticipated options transactions,
and such exchanges have advised such clearing corporation that they believe
their facilities will also be adequate to handle reasonably anticipated volume.

The use of over-the-counter options is discussed in the Prospectuses.
See "DERIVATIVE INVESTMENTS - Options on Securities"

OPTIONS ON STOCK INDICES

In contrast to an option on a security, an option on a stock index
provides the holder with the right to make or receive a cash settlement upon
exercise of the option, rather than the right to purchase or sell a security.
The amount of this settlement is equal to (i) the amount, if any, by which the
fixed exercise price of the option exceeds (in the case of a call) or is below
(in the case of a put) the closing value of the underlying index on the date of
exercise, multiplied by (ii) a fixed "index multiplier." The purchaser of the
option receives this cash settlement amount if the closing level of the stock
index on the day of exercise is greater than, in the case of a call, or less
than, in the case of a put, the exercise price of the option. The writer of the
option is obligated, in return for the premium received, to make delivery of
this amount if the option is exercised. As in the case of options on
securities, the writer or holder may liquidate positions in stock index options
prior to exercise or expiration by entering into closing transactions on the

58
<PAGE>

exchange on which such positions were established, subject to the availability
of a liquid secondary market.

The index underlying a stock index option may be a "broad-based"
index, such as the Standard & Poor's 500 Index or the New York Stock Exchange
Composite Index, the changes in value of which ordinarily will reflect movements
in the stock market in general. In contrast, certain options may be based on
narrower market indices, such as the Standard & Poor's 100 Index, or on indices
of securities of particular industry groups, such as those of oil and gas or
technology companies. A stock index assigns relative values to the stock
included in the index and the index fluctuates with changes in the market values
of the stocks so included.

FUTURES CONTRACTS ON FIXED INCOME
SECURITIES AND STOCK INDICES

A futures contract is a bilateral agreement providing for the purchase
and sale of a specified type and amount of a financial instrument, or for the
making and acceptance of a cash settlement, at a stated time in the future, for
a fixed price. By its terms, a futures contract provides for a specified
settlement date on which, in the case of the majority of interest rate futures
contracts, the fixed income securities underlying the contract are delivered by
the seller and paid for by the purchaser, or on which, in the case of stock
index futures contracts and certain interest rate futures contracts, the
difference between the price at which the contract was entered into and the
contract's closing value is settled between the purchaser and seller in cash.
Futures contracts differ from options in that they are bilateral agreements,
with both the purchaser and the seller equally obligated to complete the
transaction. In addition, futures contracts call for settlement only on the
expiration date, and cannot be "exercised" at any other time during their term.

The purchase or sale of a futures contract also differs from the
purchase or sale of a security or the purchase of an option in that no purchase
price is paid or received. Instead, an amount of cash or cash equivalent, which
varies but may be as low as 5% or less of the value of the contract, must be
deposited with the broker as "initial margin." Subsequent payments to and from
the broker, referred to as "variation margin," are made on a daily basis as the
value of the index or instrument underlying the futures contract fluctuates,
making positions in the futures contract more or less valuable, a process known
as "marking to the market."

A futures contract may be purchased or sold only on an exchange, known
as a "contract market," designated by the Commodity Futures Trading Commission
for the trading of such contract, and only through a registered futures
commission merchant which is a member of such contract market. A commission
must be paid on each completed purchase and sale transaction. The contract
market clearing house guarantees the performance of each party to a futures
contract by in effect taking the opposite side of such contract. At any time
prior to the expiration of a futures contract, a trader may elect to close out
its position by taking an opposite position on the contract market on which the
position was entered into, subject to the availability of a secondary market,
which will operate to terminate the initial position. At that time, a final
determination of variation margin is made and any loss experienced by the trader
is required to

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<PAGE>

be paid to the contract market clearing house while any profit due to the trader
must be delivered to it.

Interest rate futures contracts currently are traded on a variety of
fixed income securities, including long-term U.S. Treasury Bonds, Treasury
Notes, Government National Mortgage Association modified pass-through
mortgage-backed securities, U.S. Treasury Bills, bank certificates of deposit
and commercial paper.

A stock index futures contract provides for the making and acceptance
of a cash settlement in much the same manner as the settlement of an option on a
stock index. The types of indices underlying stock index futures contracts are
essentially the same as those underlying stock index options, as described
above. The index assigns weighted values to the securities included in the
index and its composition is changed periodically.

OPTIONS ON FUTURES CONTRACTS

An option on a futures contract provides the holder with the right to
enter into a "long" position in the underlying futures contract, in the case of
a call option, or a "short" position in the underlying futures contract in the
case of a put option, at a fixed exercise price to a stated expiration date.
Upon exercise of the option by the holder, the contract market clearing house
establishes a corresponding short position for the writer of the option, in the
case of a call option, or a corresponding long position, in the case of a put
option. In the event that an option is exercised, the parties will be subject
to all the risks associated with the trading of futures contracts, such as
payment of variation margin deposits. In addition, the writer of an option on a
futures contract, unlike the holder, is subject to initial and variation margin
requirements on the option position.

A position in an option on a futures contract may be terminated by the
purchaser or seller prior to expiration by effecting a closing purchase or sale
transaction, subject to the availability of a liquid secondary market, which is
the purchase or sale of an option of the same series (I.E., the same exercise
price and expiration date) as the option previously purchased or sold. The
difference between the premiums paid and received represents the trader's profit
or loss on the transaction.

An option, whether based on a futures contract, a stock index or a
security, becomes worthless to the holder when it expires. Upon exercise of an
option, the exchange or contract market clearing house assigns exercise notices
on a random basis to those of its members which have written options of the same
series and with the same expiration date. A brokerage firm receiving such
notices then assigns them on a random basis to those of its customers which have
written options of the same series and expiration date. A writer therefore has
no control over whether an option will be exercised against it, nor over the
time of such exercise.

<PAGE>

EVERGREEN EQUITY TRUST
PART C - OTHER INFORMATION

ITEM 24. FINANCIAL STATEMENTS AND EXHIBITS

(a) Financial Statements

The following financial statements are incorporated by reference to the
Registrant's Annual Report, as filed with the Securities and Exchange
Commission.

Evergreen U.S. Real Evergreen Global Real
Estate Equity Fund Estate Equity Fund
----------------------- -------------------------

<S> <C> <C>
Class A Financial Highlights For each of the years For each of the years in
in the two-year period the two-year period
ended September 30, 1997; ended October 31, 1997;
and for the period from and for the period from
March 10, 1995 February 10, 1995
(commencement of (commencement of
operations) to operations) to
September 30, 1995 October 31, 1995

Class B Financial Highlights For each of the years For each of the years in
in the two-year period the two-year period
ended September 30, 1997; ended October 31, 1997;
and for the period from and for the period from
March 7, 1995 February 8, 1995
(Commencement of (commencement of
Operations) to operations) to
September 30, 1995. October 31, 1995

Class C Financial Highlights For each of the years For each of the years
in the two-year period in the two-year period
ended September 30, 1997; ended October 31, 1997;
and for the period from and for the period from
July 12, 1995 February 9, 1995
(Commencement of (commencement of
Operations) to operations) to
September 30, 1995. October 31, 1995

</TABLE>

5
<PAGE>

Evergreen U.S. Real Evergreen Global Real
Estate Equity Fund Estate Equity Fund
----------------------- -------------------------

<S> <C> <C>
Class Y Financial Highlights For each of the years For each of the years
in the three-year period in the two-year period
ended September 30, 1997; ended October 31, 1997;
for the nine-month period for the periods from
ended September 30, 1994; October 1, 1995 to
and for the period from October 31, 1995 and
September 1, 1993 December 31, 1993
(Commencement of to September 30, 1994;
Operations) to for each of the years
December 31, 1993. in the four-year period
ended December 31, 1993;
and for the period from
February 1, 1989
(commencement of
Operations) to
December 31, 1989.

Schedule of Investments September 30, 1997 October 31, 1997

Statement of Assets and Liabilities September 30, 1997 October 31, 1997

Statement of Operations Year ended Year ended
September 30, 1997 October 31, 1997

Statement of Changes in Net Assets For each of the years For each of the years
in the two-year period in the two-year period
ended September 30, 1997 ended October 31, 1997

Notes to Financial Statements

Independent Accountants' Report November 11, 1997

</TABLE>

6
<PAGE>

(b) Exhibits

Number Description

1(A) Declaration of Trust*
1(B) Certification of Amendment to Declaration of Trust*
1(C) Form of Instrument providing for the Establishment and
Designation of Classes*
2 By-Laws*
3 None
4 Instruments Defining Rights of Shareholders*
5 Investment Advisory Agreement*
6 Distribution Agreement*
7 None
8 Custodian Agreement*
9 None
10 None
11 Consent of Price Waterhouse, independent accountants**
12 None
13 None
14 None
15 Rule 12b-1 Distribution Plans*
16 Performance Calculations**
17 Copy of Financial Data Schedules**
18 Multiple Class Plan*
19 Powers of Attorney*

- --------------------
* Incorporated by reference to Registrant's previous filings on Form N-1A.
** Filed herewith.

7
<PAGE>

ITEM 25. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH REGISTRANT

Stephen A. Lieber, Chairman and Co-Chief Executive Officer of Evergreen
Asset Management Corp., the investment adviser to all of Registrant's separate
investment series, owns, as of January 12, 1998, 33.486% of the outstanding
shares of Evergreen Global Real Estate Equity Fund, a series of the
Registrant, and therefore, with respect to matters on which only shareholders
of that series may vote, Mr. Lieber may be presumed to "control" that series.

ITEM 26. NUMBER OF HOLDERS OF SECURITIES

TITLE OF CLASS NUMBER OF RECORD HOLDERS
AS OF DECEMBER 31, 1997
EVERGREEN U.S. REAL ESTATE EQUITY FUND:
Class Y Shares of Beneficial Interest 470
Class A Shares of Beneficial Interest 374
Class B Shares of Beneficial Interest 508
Class C Shares of Beneficial Interest 125
EVERGREEN GLOBAL REAL ESTATE EQUITY FUND:
Class Y Shares of Beneficial Interest 1,408
Class A Shares of Beneficial Interest 23
Class B Shares of Beneficial Interest 44
Class C Shares of Beneficial Interest 9

ITEM. 27. INDEMNIFICATION

Article XI of the Registrant's By-laws contains the following provisions
regarding indemnification of Trustees and officers:

SECTION 11.1 Actions Against Trustee or Officer. The Trust shall
indemnify any individual who is a present or former Trustee or officer of the
Trust and who, by reason of his position as such, was, is, or is threatened to
be made a party to any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative or investigative

8
<PAGE>

(other than any action or suit by or in the right of the Trust) against
expenses, including attorneys' fees, judgments, fines, and amounts paid in
settlement, actually and reasonably incurred by him in connection with the
claim, action, suit, or proceeding, if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the Trust,
and, with respect to any criminal action or proceeding, had no reasonable cause
to believe his conduct was unlawful. The termination of any action, suit or
proceeding by judgment, order, settlement, conviction, or upon the plea of nolo
contendere or its equivalent, shall not, of itself, create a presumption that
the person did not act in good faith and in a manner which he reasonably
believed to be in or not opposed to the best interests of the Trust, and, with
respect to any criminal action or proceeding, had reasonable cause to believe
that his conduct was unlawful.

SECTION 11.2 Derivative Actions Against Trustees or Officers. The Trust
shall indemnify any individual who is a present or former Trustee or officer of
the Trust and who, by reason of his position as such, was, is, or is threatened
to be made a party to any threatened, pending or completed action or suit by or
on behalf of the Trust to obtain a judgment or decree in its favor, against
expenses, including attorneys' fees, actually and reasonably incurred by him in
connection with the defense or settlement of the action or suit, if he acted in
good faith and in a manner he reasonably believed to be in or not opposed to the
best interests of the Trust, except that no indemnification shall be made in
respect of any claim, issue or matter as to which the individual has been
adjudged to be liable for negligence or misconduct in the performance of his
duty to the Trust, except to the extent that the court in which the action or
suit was brought determines upon application that, despite the adjudication of
liability but in view of all circumstances of the case, the person is fairly and
reasonably entitled to indemnity for those expenses which the court shall deem
proper, provided such Trustee or officer is not adjudged to be liable by reason
of his willful misfeasance, bad faith, gross negligence or reckless disregard of
the duties involved in the conduct of his office.

SECTION 11.3 Expenses of Successful Defense. To the extent that a
Trustee or officer of the Trust has been successful on the merits or otherwise
in defense of any action, suit or proceeding referred to in Section 11.1 or 11.2
or in defense of any claim, issue, or matter therein, he shall be indemnified
against expenses, including attorneys' fees, actually and reasonably incurred by
him in connection therewith.

SECTION 11.4 Required Standard of Conduct.

(a) Unless a court orders otherwise, any indemnification under Section
11.1 or 11.2 may be made by the Trust only as authorized in the specific case
after a determination that indemnification of the Trustee or officer is proper
in the circumstances because he has met the applicable standard of conduct set
forth in Section 11.1 or 11.2. The determination shall be made by:

(i) the Trustees, by a majority vote of a quorum consisting of
Trustees who were not parties to the action, suit or proceeding; or if the
required quorum is not obtainable, or if a quorum of disinterested Trustees so
directs,

(ii) an independent legal counsel in a written opinion.

9
<PAGE>

(b) Nothing contained in this Article XI shall be construed to protect
any Trustee or officer of the Trust against any liability to the Trust or its
Shareholders to which he would otherwise be subject by reason of willful
misfeasance, bad faith, gross negligence, or reckless disregard of the duties
involved in the conduct of his office (any such conduct being hereinafter called
"Disabling Conduct"). No indemnification shall be made pursuant to this Article
XI unless:

(i) There is a final determination on the merits by a court or other
body before whom the action, suit or proceeding was brought that the individual
to be indemnified was not liable by reason of Disabling Conduct; or

(ii) In the absence of such a judicial determination, there is a
reasonable determination, based upon a review of the facts, that such individual
was not liable by reason of Disabling Conduct, which determination shall be made
by:

(A) A majority of a quorum of Trustees who are neither
"interested persons" of the Trust, as defined in section 2(a) (19) of the 1940
Act, nor parties to the action, suit or proceeding; or

(B) An independent legal counsel in a written opinion.

SECTION 11.5 Advance Payments. Notwithstanding any provision of this
Article XI, any advance payment of expenses by the Trust to any Trustee or
officer of the Trust shall be made only upon the undertaking by or on behalf of
such Trustee or officer to repay the advance unless it is ultimately determined
that he is entitled to indemnification as above provided, and only if one of the
following conditions is met:

(a) the Trustee or officer to be indemnified provides a security for his
undertaking; or

(b) The Trust is insured against losses arising by reason of any lawful
advances; or

(c) There is a determination, based on a review of readily available
facts, that there is reason to believe that the Trustee or officer to be
indemnified ultimately will be entitled to indemnification, which determination
shall be made by:

(i) A majority of a quorum of Trustees who are neither "interested
persons" of the Trust, as defined in Section 2(a) (19) of the 1940 Act, nor
parties to the action, suit or proceeding; or

(ii) An independent legal counsel in a written opinion.

SECTION 11.6 Former Trustees and Officers. The indemnification provided
by this Article XI shall continue as to an individual who has ceased to be a
Trustee or officer of the Trust and inure to the benefit of the legal
representatives of such individual and shall not be deemed exclusive of any
other rights to which any Trustee, officer, employee or agent of the Trust may
be entitled under any agreement, vote of Trustees or otherwise, both as to
action in his official

10
<PAGE>

capacity and as to action in another capacity while holding office as such;
provided, that no Person may satisfy any right of indemnity granted herein or to
which he may be otherwise entitled, except out of the Trust Property, and no
Shareholder shall be personally liable with respect to any claim for indemnity.

SECTION 11.7 Insurance. The Trust may purchase and maintain insurance on
behalf of any person who is or was a Trustee, officer, employee, or agent of the
Trust, against any liability asserted against him and incurred by him in any
such capacity, or arising out of his status as such. However, the Trust shall
not purchase insurance to indemnify any Trustee or officer against liability for
any conduct in respect of which the 1940 Act prohibits the Trust itself from
indemnifying him.

SECTION 11.8 Other Rights to Indemnification. The indemnification
provided for herein shall not be deemed exclusive of any other rights to which
those seeking indemnification may be entitled under any By-Law, agreement, vote
of Shareholders or disinterested Trustees or otherwise.

Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to Trustees, officers and controlling persons of the
Registrant pursuant to the foregoing provisions or otherwise, the Registrant has
been advised that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Registrant of expenses incurred
or paid by a Trustee, officer, or controlling person of the Registrant in
connection with the successful defense of any action, suit or proceeding) is
asserted by such Trustee, officer or controlling person in connection with the
shares being registered, the Registrant will, unless in the opinion of its
counsel the matter has been settled by controlling precedent, submit to a court
of appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Act and will be governed by the final
adjudication of such issue.

ITEM 28. BUSINESS AND OTHER CONNECTIONS OF INVESTMENT ADVISER

The Directors and principal executive officers of First Union National
Bank, North Carolina, the parent of Evergreen Asset Management Corp., are:

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

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

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

11
<PAGE>

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

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

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

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

ITEM 29. PRINCIPAL UNDERWRITERS

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

Lynn C. Mangum Director, Chairman and Chief Executive
Officer

Robert J. McMullan Director, Executive Vice President and
Treasurer

J. David Huber President

Kevin J. Dell Vice President, General Counsel and Secretary

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

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

ITEM 30. LOCATION OF ACCOUNTS AND RECORDS

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

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

12
<PAGE>

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

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

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

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

ITEM 31. MANAGEMENT SERVICES

Not Applicable.

ITEM 32. UNDERTAKINGS

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

13
<PAGE>

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant certifies that it has duly caused
this Post-Effective Amendment No. 17 to the Registration Statement to be signed
on its behalf by the undersigned, thereto duly authorized, in the City of New
York, and State of New York on the 4th day of February, 1998.

EVERGREEN EQUITY TRUST

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

Pursuant to the requirements of the Securities Act of 1933, this
Post-Effective Amendment No. 17 to the Registration Statement has been signed
below by the following persons in the capacities and on the date indicated.

Signatures Title Date
- ---------- ----- ----

/s/ William J. Tomko President and Treasurer February 4, 1998
- --------------------
William J. Tomko

/s/ Laurence B. Ashkin Trustee February 4, 1998
- ----------------------
Laurence B. Ashkin
by Dorothy E. Bourassa
Attorney - In - Fact

/s/ Foster Bam Trustee February 4, 1998
- --------------
Foster Bam
by Dorothy E. Bourassa
Attorney - In - Fact

14
<PAGE>

/s/ James S. Howell Trustee February 4, 1998
- -------------------
James S. Howell
by Dorothy E. Bourassa
Attorney - In - Fact

/s/ Gerald M. McDonnell Trustee February 4, 1998
- -----------------------
Gerald M. McDonnell
by Dorothy E. Bourassa
Attorney - In - Fact

/s/ Thomas L. McVerry Trustee February 4, 1998
- ---------------------
Thomas L. McVerry
by Dorothy E. Bourassa
Attorney - In - Fact

/s/ William Walt Pettit Trustee February 4, 1998
- -----------------------
William Walt Pettit
by Dorothy E. Bourassa
Attorney - In - Fact

/s/ Russell A. Salton, III, M.D. Trustee February 4, 1998
- --------------------------------
Russell A. Salton, III, M.D.
by Dorothy E. Bourassa
Attorney - In - Fact

/s/ Michael S. Scofield Trustee February 4, 1998
- -----------------------
Michael S. Scofield
by Dorothy E. Bourassa
Attorney - In - Fact

<PAGE>

Exhibit 99.5

January __, 1998

Alpine Management & Research, LLC
2500 Westchester Avenue
Purchase, New York 10577

Dear Sirs:

The undersigned, Alpine Equity Trust (the "Trust") is an investment
company organized as a series company, which means that it may offer separate
classes (or series) of shares comprising different investment portfolios.
Presently, the Trust offers two investment funds: Alpine U.S. Real Estate
Equity Fund and Alpine International Real Estate Equity Fund (the "Funds"). The
Trust desires to employ its capital by investing and reinvesting the same in
securities in accordance with the limitations specified in its Declaration of
Trust and in the Prospectus for each Fund as from time to time in effect, copies
of which have been, or will be, submitted to you, and in such manner and to such
extent as may from time to time be approved by the Trustees of the Trust.
Subject to the terms and conditions of this Agreement, the Trust desires to
employ your company (the "Adviser") and the Adviser desires to be so employed,
to supervise and assist in the management of the business of each Fund.
Accordingly, this will confirm our agreement as follows:

1. The Adviser shall, on a continuous basis, furnish reports,
statistical and research services, and make investment decisions with respect to
the investments of each Fund. The Adviser shall use its best judgment in
rendering these services to the Trust, and the Trust agrees as an inducement to
the Adviser undertaking such services that the Adviser shall not be liable for
any mistake of judgment or in any other event whatsoever, except for lack of
good faith, provided that nothing herein shall be deemed to protect the Adviser
against any liability to the Trust or to the shareholders of the Trust (or any
Fund) to which it would otherwise be subject by reason of willful misfeasance,
bad faith or gross negligence in the performance of the Adviser's duties
hereunder or by reason of the Adviser's reckless disregard of its obligations
and duties hereunder.

2. The Adviser agrees that it will not make short sales of the
Trust's shares of beneficial interest.

3. The Adviser agrees that in any case where an officer or director
of the Adviser is also an officer or director of another corporation, and the
purchase or sale of securities issued by such other corporation is under
consideration, such officer or director shall abstain from participation in any
decision made on behalf of the Trust (or any Fund) to purchase or sell any
securities issued by such other corporation.

<PAGE>

4. The Adviser will provide office facilities to the Trust. Each
Fund will pay the cost of all of its expenses and liabilities, including
expenses and liabilities incurred in connection with maintaining its
registration under the Investment Company Act of 1940, as amended (the "Act"),
and the Securities Act of 1933, as amended, and maintaining any registrations or
qualifications under the securities laws of the states in which the Trust's
shares are registered or qualified for sale, subsequent registrations and
qualifications, costs and expenses of engraving and printing share certificates,
the costs and expenses of preparing, printing, including typesetting, and
distributing prospectuses and statements of additional information of the Trust
and the Funds and supplements thereto to the Trust's shareholders, mailing,
brokerage, issue and transfer taxes on sales of Fund securities, custodian and
stock transfer charges, printing, legal and auditing expenses, expenses of
shareholders' meetings, and reports to shareholders; provided, however, that the
Adviser's fee will be reduced by, or the Adviser will reimburse the Fund for,
any amount necessary to prevent such expenses and liabilities (exclusive of
taxes, interest, brokerage commissions and extraordinary expenses, which
extraordinary expenses are determined by the Trust and the Adviser, but
inclusive of the Adviser's fee) from exceeding the most restrictive of the
expense limitations imposed by state securities commissions of the states in
which the Trust's shares are then registered or qualified for sale.

5. In consideration of the Adviser performing its obligations
hereunder, the Trust will pay to the Adviser: (a) a monthly fee computed at the
annual rates of 1% of the average daily net assets of Alpine U.S. Real Estate
Equity Fund on the first $750 million of assets, 0.9% of the average daily net
assets of Alpine U.S. Real Estate Equity Fund on the next $250 million in
assets, and 0.8% of the average daily net assets of Alpine U.S. Real Estate
Equity Fund in excess of $1 billion; and (b) a monthly advisory fee computed at
the annual rate of 1% of the average daily net assets of Alpine International
Real Estate Equity Fund.

6. The Trust understands that the Adviser acts as investment adviser
to other investment companies, and that the Adviser and its affiliates may act
as investment advisers to individuals, partnerships, corporations, pension funds
and other entities, and the Trust confirms that it has no objection to the
Adviser or its affiliates so acting.

7. This Agreement shall be in effect until January ___, 2000. This
Agreement shall continue in effect from year to year thereafter with respect to
each Fund, provided it is approved, at least annually, in the manner required by
the Act. The Act requires that, with respect to each Fund, this Agreement and
any renewal thereof be approved by a vote of a majority of Trustees of the Trust
who are not parties thereto or interested persons (as defined in the Act) of any
such party, cast in person at a meeting duly called for the purpose of voting on
such approval, and by a vote of the Trustees of the Trust or a majority of the
outstanding voting securities of the Fund. A vote of a majority of the
outstanding voting securities of a Fund is defined in the Act to mean a vote of
the lesser of (i) more than 50% of the outstanding voting securities of the Fund
or (ii) 67% or more of the voting securities present at the meeting if more than
50% of the outstanding voting securities are present or represented by proxy.

<PAGE>

This Agreement may be terminated at any time with respect to a Fund,
without payment of any penalty, on sixty (60) days' prior written notice by a
vote of a majority of the Funds' outstanding voting securities, by a vote of a
majority of the Trustees of the Trust, or by the Adviser. This Agreement shall
be automatically terminated in the event of its assignment (as such term is
defined in the Act).

8. This Agreement is made by the Trust pursuant to authority granted
by the Trustees, and the obligations created hereby are not binding on any of
the Trustees or shareholders of the Trust individually, but bind only the
property of the Trust.

If the foregoing is in accordance with your understanding, please so
indicate by signing and returning to the undersigned the enclosed copy hereof.

Very truly yours,

ALPINE EQUITY TRUST

By:
----------------------------------
Name:
Title:

ACCEPTED:

ALPINE MANAGEMENT & RESEARCH, LLC

By:
------------------------------
Name:
Title:

<PAGE>

CONSENT OF INDEPENDENT ACCOUNTANTS

We hereby consent to the incorporation by reference in the Prospectuses and
Statement of Additional Information constituting parts of this Post-Effective
Amendment No. 17 to the registration statement on Form N-1A (the
"Registration Statement") of our reports dated November 11, 1997 and December
19, 1997, relating to the financial statements and financial highlights of
Evergreen U.S. Real Estate Equity Fund and Evergreen Global Real Estate
Equity Fund, respectively, appearing in the September 30, 1997 and October
31, 1997 Annual Report to Shareholders of Evergreen U.S. Real Estate Equity
Fund and Evergreen Global Real Estate Equity Fund, respectively, which
financial statements and financial highlights are also incorporated by
reference into the Registration Statement. We also consent to the references
to us under the heading "Financial Highlights" in the Prospectuses and under
the headings "Independent Auditors" and "Financial Statements" in the
Statement of Additional Information.

/s/Price Waterhouse LLP
Price Waterhouse LLP
1177 Avenue of the Americas
New York, New York 10036
February 4, 1998

<PAGE>

CLASS A
<TABLE>
<CAPTION>
$952.50
A NAV A A
TIME ACCOUNT A AVERAGE A/C VALUE A AVERAGE
YEARS PERIOD VALUE CLASS ANNNUAL W/LOAD CLASS ANNNUAL
<S> <C> <C> <C> <C> <C> <C> <C>
31-Oct-97 BLANK 1,129.14 0.00% 952.5 -4.75% -4.75%
30-Sep-97 1 MO 1,178.01 -4.15% -4.15% 912.99 -8.70% -8.70%
31-Jul-97 QTR 1,135.25 -0.54% -0.54% 947.38 -5.26% -5.26%
31-Dec-96 YTD 1,120.42 0.78% 0.78% 959.92 -4.01% -4.01%
31-Oct-96 1 1,071.55 5.37% 5.37% 1,003.69 0.37% 0.37%
31-Oct-94 3
31-Oct-92 5
31-Oct-87 10
10-Feb-95 INCEPT. 1,000.00 12.91% 4.56% 1,075.51 7.55% 2.71%

INCEPTION FACTOR: 2.726
</TABLE>

Page 1

<PAGE>

CLASS B
<TABLE>
<CAPTION>
$1,000
B B NAV LEVEL VALUE OF VALUE OF B
TIME ACCOUNT B AVERAGE LOAD CLASS B CLASS B B AVERAGE
YEARS PERIOD VALUE CLASS ANNNUAL COMP INVESTMENT INVESTMENT CUMULATIVE ANNUAL
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
31-Oct-97 BLANK 1,109.27 0.00% 50 1,000.00 1,000.00 0.00%
30-Sep-97 1 MO 1,159.09 -4.30% -4.30% 47.851 957.01 957.01 -9.08% -9.08%
31-Jul-97 QTR 1,118.01 -0.78% -0.78% 49.609 992.18 992.18 -5.74% -5.74%
31-Dec-96 YTD 1,108.39 0.08% 0.08% 50 1,000.79 1,000.79 -4.92% -4.92%
31-Oct-96 1 1,061.19 4.53% 4.53% 50 1,045.30 1,045.30 -0.47% -0.47%
31-Oct-94 3
31-Oct-92 5
31-Oct-87 10
8-Feb-95 INCEPT. 1,000.00 10.93% 3.87% 30 1,109.27 1,109.27 7.93% 2.83%

INCEPTION FACTOR: 2.7315
</TABLE>

Page 1

<PAGE>

CLASS C
<TABLE>
<CAPTION>
$1,000
C C NAV LEVEL VALUE OF VALUE OF C
ACCOUNT C AVERAGE LOAD CLASS C CLASS C C AVERAGE
YEARS VALUE CLASS ANNNUAL COMP INVESTMENT INVESTMENT CUMULATIVE ANNUAL
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
31-Oct-97 BLANK 1,111.11 0.00% 10 1,000.00 1,000.00 0.00%
30-Sep-97 1 MO 1,160.10 -4.22% -4.22% 9.58 957.77 957.77 -5.18% -5.18%
31-Jul-97 QTR 1,118.99 -0.70% -0.70% 9.93 992.96 992.96 -1.70% -1.70%
31-Dec-96 YTD 1,108.49 0.24% 0.24% 10 1,002.37 1,002.37 -0.76% -0.76%
31-Oct-96 1 1,062.12 4.61% 4.61% 10 1,046.13 1,046.13 3.61% 3.61%
31-Oct-94 3
31-Oct-92 5
31-Oct-87 10
9-Feb-95 INCEPT. 1,000.00 11.11% 3.94% 0 1,111.11 1,111.11 11.11% 3.94%

INCEPTION FACTOR: 2.7288
</TABLE>

Page 1
<PAGE>

CLASS Y
<TABLE>
<CAPTION>
Y
ACCOUNT Y AVERAGE
YEARS VALUE CLASS ANNNUAL
<S> <C> <C> <C> <C>
31-Oct-97 BLANK 1,438.60 0.00%
30-Sep-97 1 MO 1,501.82 -4.21% -4.21%
31-Jul-97 QTR 1,446.36 -0.54% -0.54%
31-Dec-96 YTD 1,425.29 0.93% 0.93%
31-Oct-96 1 1,363.11 5.54% 5.54%
31-Oct-94 3 1,421.00 1.24% 0.41%
31-Oct-92 5 931.53 54.43% 9.08%
31-Oct-87 10
1-Feb-89 INCEPT. 1,000.00 43.86% 4.24%

INCEPTION FACTOR: 8.7534
</TABLE>

Page 1
<PAGE>

CLASS A
<TABLE>
<CAPTION>
9-Aug-02
A NAV A A
TIME ACCOUNT A AVERAGE A/C VALUE A AVERAGE
YEARS PERIOD VALUE CLASS ANNNUAL W/LOAD CLASS ANNNUAL
<S> <C> <C> <C> <C> <C> <C> <C>
30-Sep-97 BLANK 2,500.70 0.00% 952.5 -4.75% -4.75%
31-Aug-97 1 MO 2,199.43 13.70% 13.70% 1,082.97 8.30% 8.30%
30-Jun-97 QTR 1,939.53 28.93% 28.93% 1,228.09 22.81% 22.81%
31-Dec-96 YTD 1,635.67 52.89% 52.89% 1,456.23 45.62% 45.62%
30-Sep-96 1 1,402.68 78.28% 78.28% 1,698.12 69.81% 69.81%
30-Sep-94 3
30-Sep-92 5
30-Sep-87 10
10-Mar-95 INCEPT. 1,000.00 150.07% 42.96% 2,381.92 138.19% 40.28%

INCEPTION FACTOR: 2.5644
</TABLE>

Page 1
<PAGE>

CLASS B
<TABLE>
<CAPTION>
1000
B B NAV LEVEL VALUE OF VALUE OF B
TIME ACCOUNT B AVERAGE LOAD CLASS B CLASS B B AVERAGE
YEARS PERIOD VALUE CLASS ANNNUAL COMP INVESTMENT INVESTMENT CUMULATIVE ANNUAL
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
30-Sep-97 BLANK 2,461.54 0.00% 50 1,000.00 1,000.00 0
31-Aug-97 1 MO 2,165.75 13.66% 13.66% 50 1,136.58 1,136.58 8.66% 8.66%
30-Jun-97 QTR 1,912.39 28.72% 28.72% 50 1,287.16 1,287.16 23.72% 23.72%
31-Dec-96 YTD 1,619.16 52.03% 52.03% 50 1,520.25 1,520.25 47.03% 47.03%
30-Sep-96 1 1,391.69 76.87% 76.87% 50 1,768.74 1,542.30 71.87% 71.87%
30-Sep-94 3
30-Sep-92 5
30-Sep-87 10
7-Mar-95 INCEPT. 1,000.00 146.15% 41.93% 30 2,461.54 2,082.70 143.15% 41.25%
2.5726
</TABLE>

Page 1
<PAGE>

CLASS C
<TABLE>
<CAPTION>
1000
C C NAV LEVEL VALUE OF VALUE OF C
ACCOUNT C AVERAGE LOAD CLASS C CLASS C C AVERAGE
YEARS VALUE CLASS ANNNUAL COMP INVESTMENT INVESTMENT CUMULATIVE ANNUAL
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
30-Sep-97 BLANK 2,088.61 0.00% 10 1,000.00 1,000.00 0
31-Aug-97 1 MO 1,838.59 13.60% 13.60% 10 1,135.99 1,135.99 12.60% 12.60%
30-Jun-97 QTR 1,622.41 28.73% 28.73% 10 1,287.35 1,287.35 27.73% 27.73%
31-Dec-96 YTD 1,372.39 52.19% 52.19% 10 1,521.88 1,521.88 51.19% 51.19%
30-Sep-96 1 1,180.74 76.89% 76.89% 10 1,768.89 1,537.78 75.89% 75.89%
30-Sep-94 3
30-Sep-92 5
30-Sep-87 10
12-Jul-95 INCEPT. 1,000.00 108.86% 39.24% 0 2,088.61 1,759.89 108.86% 39.24%

INCEPTION FACTOR: 2.2247
</TABLE>

Page 1
<PAGE>

CLASS Y
<TABLE>
<CAPTION>
Y
ACCOUNT Y AVERAGE
YEARS VALUE CLASS ANNNUAL
<S> <C> <C> <C> <C>
30-Sep-97 BLANK 2,416.34 0.00%
31-Aug-97 1 MO 2,124.99 13.71% 13.71%
30-Jun-97 QTR 1,872.07 29.07% 29.07%
31-Dec-96 YTD 1,575.76 53.34% 53.34%
30-Sep-96 1 1,351.51 78.79% 78.79%
30-Sep-94 3 1,011.70 138.84% 33.67%
30-Sep-92 5
30-Sep-87 10
1-Sep-93 INCEPT. 1,000.00 141.63% 24.11%

INCEPTION FACTOR: 4.0849
</TABLE>

Page 1

<PAGE>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM ACCOUNTING
RECORDS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH ACCOUNTING
RECORDS.
</LEGEND>
<SERIES>
<NUMBER> 001
<NAME> EVERGREEN U.S. REAL ESTATE EQUITY FUND CLASS A

<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> SEP-30-1997
<PERIOD-START> SEP-01-1996
<PERIOD-END> SEP-30-1997
<INVESTMENTS-AT-COST> 20,722,324
<INVESTMENTS-AT-VALUE> 26,871,169
<RECEIVABLES> 1,680,612
<ASSETS-OTHER> 241,410
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 28,793,191
<PAYABLE-FOR-SECURITIES> 1,345,104
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 92,078
<TOTAL-LIABILITIES> 1,437,182
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 17,403,899
<SHARES-COMMON-STOCK> 143,621
<SHARES-COMMON-PRIOR> 21,053
<ACCUMULATED-NII-CURRENT> 94,223
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 3,709,042
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 6,148,845
<NET-ASSETS> 27,356,009
<DIVIDEND-INCOME> 402,951
<INTEREST-INCOME> 6,392
<OTHER-INCOME> 0
<EXPENSES-NET> (254,250)
<NET-INVESTMENT-INCOME> 155,093
<REALIZED-GAINS-CURRENT> 4,054,572
<APPREC-INCREASE-CURRENT> 5,804,070
<NET-CHANGE-FROM-OPS> 10,013,735
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 6,261
<DISTRIBUTIONS-OF-GAINS> 38,196
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 184,220
<NUMBER-OF-SHARES-REDEEMED> (64,718)
<SHARES-REINVESTED> 3,065
<NET-CHANGE-IN-ASSETS> 3,587,510
<ACCUMULATED-NII-PRIOR> 197,030
<ACCUMULATED-GAINS-PRIOR> 1,102,519
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> (156,812)
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> (254,250)
<AVERAGE-NET-ASSETS> 729,674
<PER-SHARE-NAV-BEGIN> 12.49
<PER-SHARE-NII> 0.12
<PER-SHARE-GAIN-APPREC> 8.57
<PER-SHARE-DIVIDEND> (0.26)
<PER-SHARE-DISTRIBUTIONS> (1.58)
<RETURNS-OF-CAPITAL> 0.00
<PER-SHARE-NAV-END> 19.34
<EXPENSE-RATIO> 1.77
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0

</TABLE>

<PAGE>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM ACCOUNTING
RECORDS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH ACCOUNTING
RECORDS.
</LEGEND>
<SERIES>
<NUMBER> 002
<NAME> EVERGREEN U.S. REAL ESTATE EQUITY FUND CLASS B

<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> SEP-30-1997
<PERIOD-START> SEP-01-1996
<PERIOD-END> SEP-30-1997
<INVESTMENTS-AT-COST> 20,722,324
<INVESTMENTS-AT-VALUE> 26,871,169
<RECEIVABLES> 1,680,612
<ASSETS-OTHER> 241,410
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 28,793,191
<PAYABLE-FOR-SECURITIES> 1,345,104
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 92,078
<TOTAL-LIABILITIES> 1,437,182
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 17,403,899
<SHARES-COMMON-STOCK> 179,988
<SHARES-COMMON-PRIOR> 34,708
<ACCUMULATED-NII-CURRENT> 94,223
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 3,709,042
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 6,148,845
<NET-ASSETS> 27,356,009
<DIVIDEND-INCOME> 402,951
<INTEREST-INCOME> 6,392
<OTHER-INCOME> 0
<EXPENSES-NET> (254,250)
<NET-INVESTMENT-INCOME> 155,093
<REALIZED-GAINS-CURRENT> 4,054,572
<APPREC-INCREASE-CURRENT> 5,804,070
<NET-CHANGE-FROM-OPS> 10,013,735
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 9,714
<DISTRIBUTIONS-OF-GAINS> 78,705
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 154,550
<NUMBER-OF-SHARES-REDEEMED> (16,358)
<SHARES-REINVESTED> 7,088
<NET-CHANGE-IN-ASSETS> 2,229,478
<ACCUMULATED-NII-PRIOR> 197,030
<ACCUMULATED-GAINS-PRIOR> 1,102,519
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> (156,812)
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> (254,250)
<AVERAGE-NET-ASSETS> 1,223,212
<PER-SHARE-NAV-BEGIN> 12.49
<PER-SHARE-NII> 0.12
<PER-SHARE-GAIN-APPREC> 8.57
<PER-SHARE-DIVIDEND> (0.26)
<PER-SHARE-DISTRIBUTIONS> (1.58)
<RETURNS-OF-CAPITAL> 0.00
<PER-SHARE-NAV-END> 19.34
<EXPENSE-RATIO> 1.77
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0

</TABLE>

<PAGE>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM ACCOUNTING
RECORDS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH ACCOUNTING
RECORDS.
</LEGEND>
<SERIES>
<NUMBER> 003
<NAME> EVERGREEN U.S. REAL ESTATE EQUITY FUND CLASS C

<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> SEP-30-1997
<PERIOD-START> SEP-01-1996
<PERIOD-END> SEP-30-1997
<INVESTMENTS-AT-COST> 20,722,324
<INVESTMENTS-AT-VALUE> 26,871,169
<RECEIVABLES> 1,680,612
<ASSETS-OTHER> 241,410
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 28,793,191
<PAYABLE-FOR-SECURITIES> 1,345,104
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 92,078
<TOTAL-LIABILITIES> 1,437,182
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 17,403,899
<SHARES-COMMON-STOCK> 87,415
<SHARES-COMMON-PRIOR> 10,050
<ACCUMULATED-NII-CURRENT> 94,223
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 3,709,042
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 6,148,845
<NET-ASSETS> 27,356,009
<DIVIDEND-INCOME> 402,951
<INTEREST-INCOME> 6,392
<OTHER-INCOME> 0
<EXPENSES-NET> (254,250)
<NET-INVESTMENT-INCOME> 155,093
<REALIZED-GAINS-CURRENT> 4,054,572
<APPREC-INCREASE-CURRENT> 5,804,070
<NET-CHANGE-FROM-OPS> 10,013,735
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 6,723
<DISTRIBUTIONS-OF-GAINS> 45,396
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 103,769
<NUMBER-OF-SHARES-REDEEMED> (27,945)
<SHARES-REINVESTED> 1,541
<NET-CHANGE-IN-ASSETS> 1,266,292
<ACCUMULATED-NII-PRIOR> 197,030
<ACCUMULATED-GAINS-PRIOR> 1,102,519
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> (156,812)
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> (254,250)
<AVERAGE-NET-ASSETS> 491,716
<PER-SHARE-NAV-BEGIN> 12.49
<PER-SHARE-NII> 0.12
<PER-SHARE-GAIN-APPREC> 8.57
<PER-SHARE-DIVIDEND> (0.26)
<PER-SHARE-DISTRIBUTIONS> (1.58)
<RETURNS-OF-CAPITAL> 0.00
<PER-SHARE-NAV-END> 19.34
<EXPENSE-RATIO> 1.77
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0

</TABLE>

<PAGE>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM ACCOUNTING
RECORDS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH ACCOUNTING
RECORDS.
</LEGEND>
<SERIES>
<NUMBER> 004
<NAME> EVERGREEN U.S. REAL ESTATE EQUITY FUND CLASS Y

<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> SEP-30-1997
<PERIOD-START> SEP-01-1996
<PERIOD-END> SEP-30-1997
<INVESTMENTS-AT-COST> 20,722,324
<INVESTMENTS-AT-VALUE> 26,871,169
<RECEIVABLES> 1,680,612
<ASSETS-OTHER> 241,410
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 28,793,191
<PAYABLE-FOR-SECURITIES> 1,345,104
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 92,078
<TOTAL-LIABILITIES> 1,437,182
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 17,403,899
<SHARES-COMMON-STOCK> 998,433
<SHARES-COMMON-PRIOR> 844,133
<ACCUMULATED-NII-CURRENT> 94,223
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 3,709,042
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 6,148,845
<NET-ASSETS> 27,356,009
<DIVIDEND-INCOME> 402,951
<INTEREST-INCOME> 6,392
<OTHER-INCOME> 0
<EXPENSES-NET> (254,250)
<NET-INVESTMENT-INCOME> 155,093
<REALIZED-GAINS-CURRENT> 4,054,572
<APPREC-INCREASE-CURRENT> 5,804,070
<NET-CHANGE-FROM-OPS> 10,013,735
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 227,570
<DISTRIBUTIONS-OF-GAINS> 1,293,384
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 137,476
<NUMBER-OF-SHARES-REDEEMED> (87,776)
<SHARES-REINVESTED> 104,600
<NET-CHANGE-IN-ASSETS> 2,083,236
<ACCUMULATED-NII-PRIOR> 197,030
<ACCUMULATED-GAINS-PRIOR> 1,102,519
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> (156,812)
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> (254,250)
<AVERAGE-NET-ASSETS> 13,236,678
<PER-SHARE-NAV-BEGIN> 12.49
<PER-SHARE-NII> 0.12
<PER-SHARE-GAIN-APPREC> 8.57
<PER-SHARE-DIVIDEND> (0.26)
<PER-SHARE-DISTRIBUTIONS> (1.58)
<RETURNS-OF-CAPITAL> 0.00
<PER-SHARE-NAV-END> 19.34
<EXPENSE-RATIO> 1.77
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0

</TABLE>

<PAGE>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM ACCOUNTING
RECORDS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH ACCOUNTING
RECORDS.
</LEGEND>
<SERIES>
<NUMBER> 005
<NAME> EVERGREEN GLOBAL REAL ESTATE EQUITY FUND CLASS A

<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> OCT-31-1997
<PERIOD-START> NOV-01-1996
<PERIOD-END> OCT-31-1997
<INVESTMENTS-AT-COST> 35,691,976
<INVESTMENTS-AT-VALUE> 35,747,472
<RECEIVABLES> 943,859
<ASSETS-OTHER> 48,063
<OTHER-ITEMS-ASSETS> 33,673
<TOTAL-ASSETS> 36,773,067
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 882,467
<TOTAL-LIABILITIES> 882,467
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 384,300
<SHARES-COMMON-STOCK> 26,001
<SHARES-COMMON-PRIOR> 58,723
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> (174)
<ACCUMULATED-NET-GAINS> (47,979)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 339
<NET-ASSETS> 336,486
<DIVIDEND-INCOME> 6,097
<INTEREST-INCOME> 89
<OTHER-INCOME> 0
<EXPENSES-NET> 7,038
<NET-INVESTMENT-INCOME> (852)
<REALIZED-GAINS-CURRENT> 18,199
<APPREC-INCREASE-CURRENT> 2,832
<NET-CHANGE-FROM-OPS> 20,179
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 40,811
<NUMBER-OF-SHARES-REDEEMED> (73,533)
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> (368,115)
<ACCUMULATED-NII-PRIOR> 305
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> (65,139)
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 3,851
<INTEREST-EXPENSE> 98
<GROSS-EXPENSE> 7,363
<AVERAGE-NET-ASSETS> 638,278
<PER-SHARE-NAV-BEGIN> 12.28
<PER-SHARE-NII> (0.06)
<PER-SHARE-GAIN-APPREC> 0.72
<PER-SHARE-DIVIDEND> 0.00
<PER-SHARE-DISTRIBUTIONS> 0.00
<RETURNS-OF-CAPITAL> 0.00
<PER-SHARE-NAV-END> 12.94
<EXPENSE-RATIO> 2.10
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0

</TABLE>

<PAGE>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM ACCOUNTING
RECORDS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH ACCOUNTING
RECORDS.
</LEGEND>
<SERIES>
<NUMBER> 006
<NAME> EVERGREEN GLOBAL REAL ESTATE EQUITY FUND CLASS B

<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> OCT-31-1997
<PERIOD-START> NOV-01-1996
<PERIOD-END> OCT-31-1997
<INVESTMENTS-AT-COST> 35,691,976
<INVESTMENTS-AT-VALUE> 35,747,472
<RECEIVABLES> 943,859
<ASSETS-OTHER> 48,063
<OTHER-ITEMS-ASSETS> 33,673
<TOTAL-ASSETS> 36,773,067
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 882,467
<TOTAL-LIABILITIES> 882,467
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 243,655
<SHARES-COMMON-STOCK> 16,810
<SHARES-COMMON-PRIOR> 11,075
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> (110)
<ACCUMULATED-NET-GAINS> (30,420)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 215
<NET-ASSETS> 213,340
<DIVIDEND-INCOME> 3,866
<INTEREST-INCOME> 56
<OTHER-INCOME> 0
<EXPENSES-NET> 4,463
<NET-INVESTMENT-INCOME> (541)
<REALIZED-GAINS-CURRENT> 11,538
<APPREC-INCREASE-CURRENT> 1,796
<NET-CHANGE-FROM-OPS> 12,793
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 14,681
<NUMBER-OF-SHARES-REDEEMED> (8,946)
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 85,277
<ACCUMULATED-NII-PRIOR> 194
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> (41,300)
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 2,442
<INTEREST-EXPENSE> 62
<GROSS-EXPENSE> 4,668
<AVERAGE-NET-ASSETS> 193,740
<PER-SHARE-NAV-BEGIN> 12.14
<PER-SHARE-NII> (0.15)
<PER-SHARE-GAIN-APPREC> 0.70
<PER-SHARE-DIVIDEND> 0.00
<PER-SHARE-DISTRIBUTIONS> 0.00
<RETURNS-OF-CAPITAL> 0.00
<PER-SHARE-NAV-END> 12.69
<EXPENSE-RATIO> 2.82
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0

</TABLE>

<PAGE>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM ACCOUNTING
RECORDS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH ACCOUNTING
RECORDS.
</LEGEND>
<SERIES>
<NUMBER> 007
<NAME> EVERGREEN GLOBAL REAL ESTATE EQUITY FUND CLASS C

<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> OCT-31-1997
<PERIOD-START> NOV-01-1996
<PERIOD-END> OCT-31-1997
<INVESTMENTS-AT-COST> 35,691,976
<INVESTMENTS-AT-VALUE> 35,747,472
<RECEIVABLES> 943,859
<ASSETS-OTHER> 48,063
<OTHER-ITEMS-ASSETS> 33,673
<TOTAL-ASSETS> 36,773,067
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 882,467
<TOTAL-LIABILITIES> 882,467
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 121,548
<SHARES-COMMON-STOCK> 8,378
<SHARES-COMMON-PRIOR> 676
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> (55)
<ACCUMULATED-NET-GAINS> (15,175)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 107
<NET-ASSETS> 106,425
<DIVIDEND-INCOME> 1,929
<INTEREST-INCOME> 28
<OTHER-INCOME> 0
<EXPENSES-NET> 2,227
<NET-INVESTMENT-INCOME> (270)
<REALIZED-GAINS-CURRENT> 5,756
<APPREC-INCREASE-CURRENT> 896
<NET-CHANGE-FROM-OPS> 6,382
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 8,782
<NUMBER-OF-SHARES-REDEEMED> (1,080)
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 101,863
<ACCUMULATED-NII-PRIOR> 97
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> (20,602)
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 1,218
<INTEREST-EXPENSE> 31
<GROSS-EXPENSE> 2,329
<AVERAGE-NET-ASSETS> 86,954
<PER-SHARE-NAV-BEGIN> 12.14
<PER-SHARE-NII> (0.14)
<PER-SHARE-GAIN-APPREC> 0.70
<PER-SHARE-DIVIDEND> 0.00
<PER-SHARE-DISTRIBUTIONS> 0.00
<RETURNS-OF-CAPITAL> 0.00
<PER-SHARE-NAV-END> 12.70
<EXPENSE-RATIO> 2.83
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0

</TABLE>

<PAGE>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM ACCOUNTING
RECORDS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH ACCOUNTING
RECORDS.
</LEGEND>
<SERIES>
<NUMBER> 008
<NAME> EVERGREEN GLOBAL REAL ESTATE EQUITY FUND CLASS Y

<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> OCT-31-1997
<PERIOD-START> NOV-01-1996
<PERIOD-END> OCT-31-1997
<INVESTMENTS-AT-COST> 35,691,976
<INVESTMENTS-AT-VALUE> 35,747,472
<RECEIVABLES> 943,859
<ASSETS-OTHER> 48,063
<OTHER-ITEMS-ASSETS> 33,673
<TOTAL-ASSETS> 36,773,067
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 882,467
<TOTAL-LIABILITIES> 882,467
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 40,241,034
<SHARES-COMMON-STOCK> 2,715,847
<SHARES-COMMON-PRIOR> 3,859,781
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> (18,242)
<ACCUMULATED-NET-GAINS> (5,023,984)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 35,541
<NET-ASSETS> 35,234,349
<DIVIDEND-INCOME> 638,485
<INTEREST-INCOME> 9,314
<OTHER-INCOME> 0
<EXPENSES-NET> 736,901
<NET-INVESTMENT-INCOME> (89,102)
<REALIZED-GAINS-CURRENT> 1,905,636
<APPREC-INCREASE-CURRENT> 296,589
<NET-CHANGE-FROM-OPS> 2,113,123
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (76,344)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 79,254
<NUMBER-OF-SHARES-REDEEMED> (1,226,663)
<SHARES-REINVESTED> 3,475
<NET-CHANGE-IN-ASSETS> (12,293,801)
<ACCUMULATED-NII-PRIOR> 31,958
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> (6,820,865)
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 403,230
<INTEREST-EXPENSE> 10,258
<GROSS-EXPENSE> 771,007
<AVERAGE-NET-ASSETS> 40,154,991
<PER-SHARE-NAV-BEGIN> 12.31
<PER-SHARE-NII> (0.03)
<PER-SHARE-GAIN-APPREC> 0.71
<PER-SHARE-DIVIDEND> (0.02)
<PER-SHARE-DISTRIBUTIONS> 0.00
<RETURNS-OF-CAPITAL> 0.00
<PER-SHARE-NAV-END> 12.97
<EXPENSE-RATIO> 1.82
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0

</TABLE>