Annual Report as of September 30, 2001

Evergreen Fixed Income Funds

Table of Contents

Letter to Shareholders	1	Financial Highlights
Evergreen Adjustable Rate Fund		Evergreen Adjustable Rate Fund	27
(formerly, Evergreen Select Adjustable Rate Fund)		Evergreen Core Bond Fund	30
Fund at a Glance	2	Evergreen Fixed Income Fund	33
Portfolio Manager Interview	3	Evergreen Fixed Income Fund II	34
Evergreen Core Bond Fund		Evergreen Select High Yield Bond Fund	35
(formerly, Evergreen Select Core Bond Fund)		Evergreen Income Plus Fund	36
Fund at a Glance	5	Evergreen Intermediate Term Municipal Bond Fund	37
Portfolio Manager Interview	6	Evergreen Limited Duration Fund	38
Evergreen Fixed Income Fund		Schedules of Investments
(formerly, Evergreen Select Fixed Income Fund)		Evergreen Adjustable Rate Fund	39
Fund at a Glance	8	Evergreen Core Bond Fund	43
Portfolio Manager Interview	9	Evergreen Fixed Income Fund	49
Evergreen Fixed Income Fund II		Evergreen Fixed Income Fund II	54
(formerly, Evergreen Select Fixed Income Fund II)		Evergreen Select High Yield Bond Fund	58
Fund at a Glance	11	Evergreen Income Plus Fund	63
Portfolio Manager Interview	12	Evergreen Intermediate Term Municipal Bond Fund	68
Evergreen Select High Yield Bond Fund		Evergreen Limited Duration Fund	74
Fund at a Glance	14	Combined Notes to Schedules of Investments	79
Portfolio Manager Interview	15	Statements of Assets and Liabilities	80
Evergreen Income Plus Fund		Statements of Operations	82
(formerly, Evergreen Select Income Plus Fund)		Statements of Changes in Net Assets	84
Fund at a Glance	18	Combined Notes to Financial Statements	89
Portfolio Manager Interview	19	Independent Auditors’ Report	100
Evergreen Intermediate Term Municipal Bond Fund		Additional Information	101
(formerly, Evergreen Select Intermediate Term Municipal Bond Fund)
Fund at a Glance	21
Portfolio Manager Interview	22
Evergreen Limited Duration Fund
(formerly, Evergreen Select Limited Duration Fund)
Fund at a Glance	24
Portfolio Manager Interview	25

Evergreen Funds

Evergreen Funds is one of the nation’s fastest growing investment companies with more than $90 billion in assets under management.

With over 80 mutual funds to choose among and acclaimed service and operations capabilities, investors enjoy a broad range of quality investment products and services designed to meet their needs.

The Evergreen Funds employ intensive, research-driven investment strategies executed by over 90 research analysts and portfolio managers. The fund company remains dedicated to meeting the needs of investors and their advisors in a global economy. Look to Evergreen Funds to provide a distinctive level of service and excellence in investment management.

This annual report must be preceded or accompanied by a prospectus of an Evergreen fund contained herein. The prospectus contains more complete information, including fees and expenses, and should be read carefully before investing or sending money.

Mutual Funds: NOT FDIC INSURED MAY LOSE VALUE NOT BANK GUARANTEED

Evergreen Distributor, Inc.
Evergreen Funds^SM is a service mark of Evergreen Investment Services, Inc.

Letter to Shareholders

November 2001

William M. Ennis
President and CEO
Dennis H. Ferro
Chief Investment Officer

Dear Evergreen Shareholders,

We are pleased to provide the Evergreen Fixed Income Funds annual report, which covers the twelve-month period ended September 30, 2001.

The twelve-month period ended September 30 was one of the most challenging for investors recent memory. As the economy continued to slide, corporate profits declined with it, the prospect for a large fiscal surplus began to diminish. With the Federal Reserve seeing little inflation in reported producer consumer statistics, it continued its aggressive policy of monetary easing through several interest rate cuts. While the slide in corporate profits and the slowing economy brought equity prices lower, the bond market was providing positive returns as a result of the Fed’s action. The consumer used lower rates to maintain a reasonably robust housing and auto market, despite an increasing rate in corporate layoffs.

While these trends continued as we moved through the third quarter, the terrible events of September 11 accelerated these trends through the end of the month. We were personally deeply disturbed by the destruction of the World Trade Center and lost both colleagues and friends in this tragedy.

Looking past these trends and events, we believe we are in the trough of a normal business cycle and the monetary and fiscal policy steps being taken will permit the economy to recover. Accordingly, we remain convinced that the stage is being set for a period of meaningful economic growth. With low inflation, a return to fiscal surplus and better corporate profits, this should benefit the entire spectrum of fixed income securities. The key will be the patience required by investors as we wait for the economy to return to more normal levels of growth.

The Importance of Diversification

An environment like the past twelve months offers many reasons for building a diversified portfolio rather than trying to predict the market’s movements. Diversification provides exposure to many different opportunities while reducing the risk of any single investment or strategy.

We invite you to visit our enhanced website, www.EvergreenInvestments.com, for more information about Evergreen Funds. Please be sure to check out our online shareholder newsletter, Evergreen Events. Thank you for your continued investment in Evergreen Funds.

Sincerely,

William M. Ennis
President & CEO
Evergreen Investment Company, Inc.

Dennis H. Ferro
Chief Investment Officer
Evergreen Investment Management Company

1

EVERGREEN
Adjustable Rate Fund
(formerly, Evergreen Select Adjustable Rate Fund)
Fund at a Glance as of September 30,  2001

“In this environment, we intend to
continue applying our conservative
management strategy of investing
in seasoned adjustable rate
mortgages that provide attractive
relative value.”

Portfolio
Management

Lisa Brown-Premo
Tenure: April 2001
Bob Rowe
Tenure: April 2001

PERFORMANCE AND RETURNS2
Portfolio Inception Date: 10/1/1991 Class Inception Date	Class A 6/30/2000		Class B 6/30/2000		Class C 6/30/2000		Class I 10/1/1991		Class IS 5/23/1994
Average Annual Returns*
1 year with sales charge	4.93	%	2.65	%	5.65	%	n/a		n/a
1 year w/o sales charge	8.46	%	7.65	%	7.65	%	8.73	%	8.46	%
5 years	5.78	%	5.98	%	6.30	%	6.56	%	6.30	%
Since Portfolio Inception	5.49	%	5.75	%	5.75	%	5.88	%	5.71	%
Maximum Sales Charge	3.25	%	5.00	%	2.00	%	n/a		n/a
	Front End		CDSC		CDSC
30-day SEC Yield	4.52	%	3.85	%	3.86	%	4.84	%	4.60	%
12-month income dividends per share	$0.62		$0.55		$0.55		$0.64		$0.62
* Adjusted for maximum applicable sales charge unless noted.

Comparison of a $10,000 investment in Evergreen Adjustable Rate Fund, Class A shares², versus a similar investment in the 6-Month Treasury Bill (6 Mo. T-Bill) and the Consumer Price Index (CPI).

The 6-Mo. T-Bill does not include transaction costs associated with buying and selling securities or any mutual fund expenses. The CPI is a commonly used measure of inflation and does not represent an investment return. It is not possible to invest directly in an index.

CURRENT INVESTMENT STYLE¹

Morningstar’s Style Box is based on a portfolio date as of 9/30/2001.

¹Source: 2001 Morningstar, Inc.

² Past performance is no guarantee of future results. The investment return and principal value of an investment will fluctuate so that investors’ shares, when redeemed, may be worth more or less than their original cost. The performance of each class may vary based on differences in loads, fees and expenses paid by the shareholders investing in each class. Performance includes the reinvestment of income dividends and capital gain distributions.

Historical performance shown for Classes A, B, C and IS prior to their inception is based on the performance of Class I shares, the original class offered. These historical returns for Classes A, B, C and IS have not been adjusted to reflect the effect of each class’ 12b-1 fees. The fund incurs 12b-1 expenses of 0.19% for Class A. This rate is based on 0.25% on assets prior to 1/1/1997 and 0.10% assessed on new assets from 1/1/1997. Classes B and C each incur 12b-1 expenses of 1.00%. Class IS incurs a 0.25% 12b-1 expense. Class I does not pay 12b-1 fees. If these fees had been reflected, returns would have been lower. Returns reflect expense limits previously in effect, without which returns would have been lower.

Class I and IS shares are only available to institutional shareholders with a minimum $1,000,000 investment. Class I and IS shares do not incur sales charges.

The fund’s investment objective is non-fundamental and may be changed without the vote of the fund’s shareholders.

U.S. government guarantees apply only to the underlying securities of the fund’s portfolio and not to the fund’s shares.

All data is as of September 30, 2001 and is subject to change.

2

EVERGREEN
Adjustable Rate Fund
(formerly, Evergreen Select Adjustable Rate Fund)
Portfolio Manager Interview

How did the fund perform over the past twelve months?

The fund’s Class A shares returned 8.46% for the twelve-month period ended September 30, 2001. This compared favorably to the 4.40% return for the 6-Month T-Bill for the same period. Fund returns are before deduction of any applicable sales charges. We attribute the fund’s stronger performance to three main factors: our rigorous security selection process, the fund’s relatively long average reset period and the fund’s longer duration relative to that of its index, the 6-Month U.S. Treasury Bill. Duration measures a fund’s sensitivity to changes in interest rates. A longer duration increases price sensitivity to interest rate changes and conversely, a shorter duration enhances price stability.

Portfolio
Characteristics

(as of 9/30/2001)

Total Net Assets	$945,169,585
Average Credit Quality	AAA
Average Duration	0.8 years
Effective Maturity	3.0 years

What was the environment like for adjustable rate mortgage-backed securities?

The environment was favorable because of a dramatic decline in interest rates. The Federal Reserve Board lowered rates to revive the economy’s weak growth, causing the federal funds rate to fall 3.50%. Federal funds are excess reserves that banks lend to each other; the federal funds rate is a benchmark for all other short-term interest rates. The sharp drop in rates created a more steeply sloped yield curve. This is significant to investors because the slope of the yield curve indicates the degree to which longer-term yields are higher than their shorter-term counterparts. When the yield curve gets steeper, securities with shorter maturities have outperformed longer-term bonds, a situation that is very positive for adjustable rate mortgage-backed securities.

Supply/demand characteristics also supported prices. As short-term rates fell, many borrowers chose to finance their mortgages with the low, attractive rates available in ARMS (Adjustable Rate Mortgage Securities), causing the supply of ARMS to increase. ARMS issuance tends to lag behind the direction of short-term market rates. With a clear trend toward lower rates, investors actively sought to invest in ARMS before rates fell further. As a result, the demand for ARMS strengthened, outpacing the supply and buoying prices.

What strategies did you use to manage the fund?

We focused on security selection, analyzing 26 different characteristics for each pool of mortgages selected for the fund. Some of the primary factors we considered were seasoning — or, the length of time a mortgage has been in existence; the size of individual mortgage balances within the pool; the weighted average coupon of the loans within the pool, as well as the distribution of each coupon;

3

EVERGREEN
Adjustable Rate Fund
(formerly, Evergreen Select Adjustable Rate Fund)
Portfolio Manager Interview

geography and prepayment history. Prepayments occur when a mortgage is paid off prior to maturity. When this happens, the mortgage is removed from the pool and no longer contributes to the pool’s income. Typically, prepayments rise when interest rates fall, because homeowners refinance their mortgages at lower rates. Together, these factors reflect the history of the income generated by each pool, and give us an indication of how we can expect the pools to contribute to the fund’s income stream. We also emphasized security structure, such as rate reset dates, index of which the pools reset, and the caps and floors of the securities’ coupons. Specifically, with the past year’s declining interest rate environment, we emphasized bonds whose reset dates lagged indexes, so that the U.S. Treasury Bill’s rate was based off the older, higher rate. We also sought bonds whose coupons could change no more than 1.00% per year, or that had a stated minimal rate to which the coupon could fall. Finally, we selected bonds with longer-term reset periods to maintain a higher stream of income for a longer period of time. As of September 30, 2001, the fund’s average reset period was eleven months, one month shorter than the maximum reset period allowed by the fund’s prospectus. We also managed the fund with a longer duration than the U.S. Treasury Bill. This made the fund more sensitive to interest rate changes, which increased price appreciation when interest rates fell.

What is your outlook for ARMS over the next six-months?

We think the Fed is close to the end of its easing cycle, and that short-term rates could begin to stabilize. However, we do not expect interest rates to rise in the foreseeable future. In this environment, we intend to continue applying our conservative management strategy of investing in seasoned adjustable rate mortgages that provide attractive relative value. With this careful and disciplined selection process, we believe the fund is well-positioned to produce solid returns in a variety of interest rate environments.

4

EVERGREEN
Core Bond Fund
(formerly, Evergreen Select Core Bond Fund)
Fund at a Glance as of September 30,  2001

“We believe bond prices will
continue to fluctuate in the coming
months, creating opportunities for
fixed income investors.”

Portfolio
Management

Tattersall Team
Tenure: June 1999

PERFORMANCE AND RETURNS2
Portfolio Inception Date: 12/13/1990 Class Inception Date	Class A 5/11/2001		Class B 5/11/2001		Class C 5/11/2001		Class I 12/13/1990		Class IS 10/2/1997
Average Annual Returns*
1 year with sales charge	7.98	%	8.00	%	11.00	%	N/A		N/A
1 year w/o sales charge	13.33	%	13.00	%	13.00	%	13.44	%	13.16	%
5 years	7.13	%	7.83	%	8.12	%	8.21	%	8.02	%
10 years	7.14	%	7.63	%	7.63	%	7.67	%	7.57	%
Maximum Sales Charge	4.75	%	5.00	%	2.00	%	N/A		N/A
	Front End		CDSC		CDSC
30-day SEC Yield	4.48	%	3.91	%	3.91	%	4.96	%	4.71	%
12-month income dividends per share	$0.22		$0.19		$0.19		$0.63		$0.60
* Adjusted for maximum applicable sales charge, unless noted.

Comparison of a $10,000 investment in Evergreen Core Bond Fund, Class A shares², versus a similar investment in the Lehman Brothers Aggregate Bond Index (LBABI) and the Consumer Price Index (CPI).

The LBABI is an unmanaged market index which does not include transaction costs associated with buying and selling securities or any mutual fund expenses. The CPI is a commonly used measure of inflation and does not represent an investment return. It is not possible to invest directly in an index.

CURRENT INVESTMENT STYLE¹

Morningstar’s Style Box is based on a portfolio date as of 9/30/2001.

¹Source: 2001 Morningstar, Inc.

² Past performance is no guarantee of future results. The investment return and principal value of an investment will fluctuate so that investors’ shares, when redeemed, may be worth more or less than their original cost. The performance of each class may vary based on differences in loads, fees and expenses paid by the shareholders investing in each class. Performance includes the reinvestment of income dividends and capital gain distributions.

Historical performance shown for Classes A, B and C prior to their inception is based on the performance of Class I shares, the original class offered. Historical performance shown for Class I shares is based on the performance of the Class I shares of the fund’s predecessor fund, Tattersall Bond Fund. These historical returns for Class A, B and C have not been adjusted to reflect the effect of each class’ 12b-1 fees. Historical performance shown for Class IS shares is based on (1) the performance of the Class IS shares of the fund’s predecessor fund, Tattersall Bond Fund, since 10/2/1997 and (2) the Class I shares of Tattersall Bond Fund from 12/13/1990 to 10/2/1997 which have not been adjusted to reflect the 12b-1 fee paid by Class IS shares. These fees are 0.25% for Classes A and IS, 1.00% for Classes B and C. Class I does not pay 12b-1 fees. If these fees had been reflected, returns for Classes A, B, C and IS would have been lower. The advisor is waiving a portion of its advisory fee. Had the fee not been waived, returns would have been lower.

Class I and IS shares are only available to institutional shareholders with a minimum $1,000,000 investment. Class I and IS shares do not incur sales charges.

The fund’s investment objective is non-fundamental and may be changed without the vote of the fund’s shareholders.

U.S. government guarantees apply only to the underlying securities of the fund’s portfolio and not to the fund’s shares.

All data is as of September 30, 2001 and is subject to change.

5

EVERGREEN
Core Bond Fund
(formerly, Evergreen Select Core Bond Fund)
Portfolio Manager Interview

How did the fund perform over the past twelve months?

The fund’s Class A shares returned 13.33% for the twelve-month period ended September 30, 2001. Fund returns are before deduction of any applicable sales charges. The fund’s return surpassed the 12.95% return produced by the Lehman Brothers Aggregate Bond Index for the same period. We attribute the fund’s positive performance to its emphasis on careful credit analysis and security selection, as well as its shifting of sector allocations, which took advantage of the bond market’s fluctuations.

Portfolio
Characteristics

(as of 9/30/2001)

Total Net Assets	$1,715,976,639
Average Credit Quality	AA
Effective Maturity	7.4 years
Average Duration	4.6 years

What was the fund’s environment like for fixed income securities during the period?

The twelve-month period ended September 30, 2001 was favorable for the bond market. A slowing economy and aggressive easing moves by the Federal Reserve Board caused bond prices to rise and yields to fall. In January 2001, the Federal Reserve responded to economic weakness with the first of several interest rate cuts to help stimulate growth. The stock market continued to experience weakness and volatility throughout the period, increasing investor demand for the relative safety and stability of high quality fixed income securities.

The highest quality bonds, such as U. S. Treasury and agency securities, experienced the greatest price appreciation during the period. As is often the case, high quality bonds were the most highly sought during these times of economic uncertainty and stock market fluctuation. Like U. S. Treasury and agency bonds, mortgage-backed bonds performed well during the period. However, their price increases lagged those of U. S. Treasury bonds, as concerns over mortgage prepayments tended to limit the rise of mortgage-backed bond prices as interest rates fell. Prepayments occur when homeowners pay off their mortgages prior to the stated maturity. Often this occurs when interest rates drop, because more homeowners refinance their mortgages at lower interest rates. As these mortgages are paid off, they are removed from the investment portfolio, and their income no longer contributes to total return.

The environment for corporate bonds was strong during the period, although higher quality bonds performed better than those issued by companies with weaker finances. At the beginning of the period, the yield advantage required by investors between high and low quality corporate bonds — known as the “spread” — was significantly smaller than it was at the end of the period. The situation reversed as signs of economic weakness increased as the year progressed.

6

EVERGREEN
Core Bond Fund
(formerly, Evergreen Select Core Bond Fund)
Portfolio Manager Interview

What strategies did you use in managing the fund?

Our strategies focused on careful sector allocation and security selection. We researched the bond market to find attractively priced sectors and individual securities. After evaluating the risks, we determined whether the fund was being adequately compensated for the risk being taken.

During most of the period, the fund was overweighted in mortgage-backed securities and corporate bonds, and underweighted in U. S. Treasury and agency bonds. The yield advantage provided by mortgage-backed securities and corporate bonds was a significant contributor to the fund’s performance. Further, the price fluctuation in these sectors created additional opportunity for outperformance, by investing in bonds when they were out of favor, so prices were lower. We then sold them once their prices appreciated to levels we believed maximized their price potential.

Industry selection was important for corporate bonds during the period. We closely followed industry trends and rebalanced the fund to take advantage of opportunities in various industries within the corporate bond market. For example, as the telecommunications industry experienced problems, investors demanded an increasingly higher yield advantage. The fund benefited from investing in the highest quality companies in this sector, avoiding lower quality bonds and the credit problems that often accompanied them. Because the stronger companies still provided a relatively high yield and did not experience the difficulties of lower quality companies in the industry, we believed the high quality bonds offered better relative value.

We maintained the fund’s duration. Expressed in years, duration measures a fund’s sensitivity to changes in interest rates. Lengthening duration increases sensitivity to interest rate changes and conversely, shortening duration enhances price stability. The bond market’s price fluctuations made it difficult to anticipate interest rate movements; therefore a neutral duration stance was optimal.

What is your outlook over the next six months?

Our outlook for the fixed income market remains positive. We believe bond prices will continue to fluctuate in the coming months, creating opportunities for fixed income investors. Yield premiums for corporate bonds have increased due to a higher level of economic uncertainty; however, we expect that higher quality bonds will outperform their lower-rated counterparts until investor confidence is restored. We anticipate that mortgage-backed securities will perform well in the coming period as the market absorbs the large supply of bonds that came to market in recent months and issuance levels return to normal. We will closely monitor all sectors of the bond market and seek opportunities to purchase bonds offering attractive yields and low risk. We anticipate that the high quality portion of the bond market will continue to provide stable income and strong performance in the coming months.

7

EVERGREEN
Fixed Income Fund
(formerly, Evergreen Select Fixed Income Fund)
Fund at a Glance as of September 30,  2001

“We believe the best opportunities
are in corporate and mortgage
bonds, which are at spread levels
that reflect extremely distressing
market conditions.”

Portfolio
Management

Tattersall Team
Tenure: May 2001

PERFORMANCE AND RETURNS2
Portfolio Inception Date: 3/31/1977 Class Inception Date	Class I 11/24/1997		Class IS 3/9/1998
Average Annual Returns
1 year	12.49	%	12.21	%
5 years	7.29	%	7.01	%
10 years	6.77	%	6.49	%
30-day SEC Yield	4.89	%	4.64	%
12-month income dividends per share	$0.36		$0.34

Comparison of a $1,000,000 investment in Evergreen Fixed Income Fund, Class I shares², versus a similar investment in the Lehman Brothers Intermediate Government/Credit Index (LBIGCI) and the Consumer Price Index (CPI).

The LBIGCI is an unmanaged market index which does not include transaction costs associated with buying and selling securities or any mutual fund expenses. The CPI is a commonly used measure of inflation and does not represent an investment return. It is not possible to invest directly in an index.

CURRENT INVESTMENT STYLE¹

Morningstar’s Style Box is based on a portfolio date as of 9/30/2001.

¹Source: 2001 Morningstar, Inc.

²Past performance is no guarantee of future results. The investment return and principal value of an investment will fluctuate so that investors’ shares, when redeemed, may be worth more or less than their original cost. The performance of each class may vary based on differences in fees and expenses paid by the shareholders investing in each class. Performance includes the reinvestment of income dividends and capital gain distributions.

Historical performance shown for Class IS shares from 11/24/1997 to its inception is based on the performance of Class I shares and has not been adjusted to reflect the effect of the 0.25% 12b-1 fee applicable to Class IS shares. Class I shares do not pay 12b-1 fees. If these fees had been reflected, returns would have been lower. Prior to 11/24/1997, the returns are based on the fund’s predecessor common trust fund’s (CTF) performance, adjusted for estimated mutual fund expenses. The CTF was not registered under the 1940 Act and was not subject to certain investment restrictions. If the CTF had been registered, its performance might have been adversely affected. The advisor is waiving a portion of its advisory fee. Had the fee not been waived, returns would have been lower.

Class I and IS shares are only available to institutional shareholders with a minimum $1,000,000 investment. Class I and IS shares do not incur sales charges.

The fund’s investment objective is non-fundamental and may be changed without a vote of the fund’s shareholders.

U.S. government guarantees apply only to the underlying securities of the fund’s portfolio and not to the fund’s shares.

Funds that invest in high yield, lower-rated bonds may contain more risk due to the increased possibility of default.

Foreign investments may contain more risk due to the inherent risks associated with changing political climates, foreign market instability and foreign currency fluctuations.

All data is as of September 30, 2001 and is subject to change.

8

EVERGREEN
Fixed Income Fund
(formerly, Evergreen Select Fixed Income Fund)
Portfolio Manager Interview

How did the fund perform over the past twelve months?

Evergreen Fixed Income Fund’s Class I shares returned 12.49% over the twelve-month period ended September 30, 2001. In comparison, its benchmark, the Lehman Brothers Intermediate Government/Credit Index returned 12.90%. The slight lag is attributable to the fact that the index does not incur expenses, whereas the mutual fund does. In the fall of 2000, corporate bonds proved to be the worst performing asset class. The fact that the fund was underweight in corporate bonds aided its performance. As we entered 2001, the Federal Reserve Board started easing monetary policy, and we significantly increased corporate bonds as a percentage of the fund’s assets. Through September 30, 2001, corporate bonds were the best-performing asset class within the large fixed-income sectors, and that added appreciably to portfolio performance.

Portfolio
Characteristics

(as of 9/30/2001)

Total Net Assets	$527,392,302
Average Credit Quality	AA
Effective Maturity	5.0 years
Average Duration	3.7 years

What was the environment for the fund during this period?

The general environment for fixed income securities was strong, especially at the short end of the maturity spectrum, which is where this fund invests its assets — in bonds with maturities between two and five years. That range performed best during the twelve-month period. For example, the two-year Treasury note yielded close to 6% in September 2000. A year later, that yield had fallen to 2.85%. That dramatic decline in short-term rates provided significant capital growth potential.

What was your strategy for managing the fund?

We made a number of significant asset selection changes that benefited the fund’s performance. At the end of 2000, investors were fearful the U.S. economy was heading into recession. Corporate bonds were poor performers, with a number of high-profile defaults, and a number of bonds that came near default, plunging by 30% or 40% in price. The fund avoided these difficulties by both being underweighted in corporate bonds and concentrating on high-quality names. Meanwhile, with the proceeds from the corporate bonds we sold, we took a relatively large stake in U.S. government agency debt. This segment was the best performing sector of the bond market in the fourth calendar quarter.

The situation reversed as 2001 began. The Fed began easing interest rates and the risk of recession began to fade. We purchased a large stake in corporate bonds, and they performed well for the next nine months. Following the terrorist attacks of September 11, corporate bonds retreated. Again, we saw opportunity, and bought more investment-grade bonds.

9

EVERGREEN
Fixed Income Fund
(formerly, Evergreen Select Fixed Income Fund)
Portfolio Manager Interview

As interest rates declined, prepayments on mortgage-backed securities (from refinancing activity on mortgages), accelerated appreciably, and that dramatically increased the supply of mortgages. It also increased the fear of further refinancing activity, and that caused mortgage-backed securities to underperform. We believe that underperformance represents an opportunity, and we have invested almost 36% of assets in mortgage-backed securities.

Mortgage-backed securities come in many forms, and we have invested significantly in so-called DUST (designated underwriting and servicing) bonds. These are Fannie Mae/Freddie Mac guaranteed, backed by commercial mortgages, and are highly call-protected. The benefit: these bonds continue to appreciate as interest rates fall, whereas many other mortgage-backed securities have limited potential because of prepayments.

What is your investment outlook?

We believe the best opportunities are in corporate and mortgage bonds, which are at spread levels that reflect extremely distressing market conditions. In fact, we are taking a very aggressive stake in mortgage bonds, with a 36% stake compared to a zero weighting for our benchmark index.

We do expect an economic slowdown. But inflation is already decelerating, and the events of September 11 put added pressure on the economy, which in turn should further pressure inflation. Lower inflation should support bonds going forward.

Volatility is likely to continue in the bond market for some time, but volatility creates opportunities for bond investors. We expect high-quality sectors of the market to continue to perform well in light of ongoing uncertainties in the financial markets. Economic weakness could extend through a good portion of 2002. We want to avoid companies with weak financials that might have trouble three-to-nine months in the future. Instead, we will concentrate on high credit quality instruments, with at least very strong “A” credit ratings. We want to invest in firms that can successfully weather an extended credit cycle.

10

EVERGREEN
Fixed Income Fund II
(formerly, Evergreen Select Fixed Income Fund II)
Fund at a Glance as of September 30,  2001

“We are going into an economic
slowdown, but inflation should
come down appreciably, which could
provide support for bonds.”

Portfolio
Management

Tattersall Team
Tenure: May 2001

PERFORMANCE AND RETURNS2
Portfolio Inception Date: 12/6/1994 Class Inception Date	Class I 12/6/1994		Class IS 10/18/1999
Average Annual Returns
1 year	12.63	%	12.45	%
5 years	7.49	%	7.40	%
Since Portfolio Inception	8.15	%	8.08	%
30-day SEC Yield	5.65	%	5.36	%
12-month income dividends per share	$0.84		$0.83

Comparison of a $1,000,000 investment in Evergreen Fixed Income Fund II, Class I shares², versus a similar investment in the Lehman Brothers Aggregate Bond Index (LBABI) and the Consumer Price Index (CPI).

The LBABI is an unmanaged market index which does not include transaction costs associated with buying and selling securities or any mutual fund expenses. The CPI is a commonly used measure of inflation and does not represent an investment return. It is not possible to invest directly in an index.

CURRENT INVESTMENT STYLE¹

Morningstar’s Style Box is based on a portfolio date as of 9/30/2001.

¹Source: 2001 Morningstar, Inc.

²Past performance is no guarantee of future results. The investment return and principal value of an investment will fluctuate so that investors’ shares, when redeemed, may be worth more or less than their original cost. The performance of each class may vary based on differences in fees and expenses paid by the shareholders investing in each class. Performance includes the reinvestment of income dividends and capital gain distributions.

Historical performance shown for Class IS shares prior to its inception is based on the performance of Class I shares, the original class offered. The historical returns for Class IS shares have not been adjusted to reflect the effect of the class’ 0.25% 12b-1 fee. Class I shares do not pay 12b-1 fees. If these fees had been reflected, returns would have been lower.

Class I and IS shares are only available to institutional shareholders with a minimum $1,000,000 investment. Class I and IS shares do not incur sales charges.

The fund’s investment objective is non-fundamental and may be changed without a vote of the fund’s shareholders.

U.S. government guarantees apply only to the underlying securities of the fund’s portfolio and not to the fund’s shares.

Funds that invest in high yield, lower-rated bonds may contain more risk due to the increased possibility of default.

Foreign investments may contain more risk due to the inherent risk associated with changing political climates, foreign market instability and foreign currency fluctuations.

All data is as of September 30, 2001 and is subject to change.

11

EVERGREEN
Fixed Income Fund II
(formerly, Evergreen Select Fixed Income Fund II)
Portfolio Manager Interview

How did the fund perform over the past twelve months?

Evergreen Fixed Income Fund II Class I shares had a total return of 12.63% for the twelve-month period ended September 30, 2001. The Lehman Brothers Aggregate Bond Index returned 12.95% for the same period.

Portfolio
Characteristics

(as of 9/30/2001)

Total Net Assets	$45,060,746
Average Credit Quality	AA
Effective Maturity	7.0 years
Average Duration	4.6 years

To what do you attribute the fund’s performance?

The fund slightly underperformed the Lehman Brothers Aggregate Bond Index primarily due to its small position in high yield bonds during the first three months of the period (October through December). Although our high yield holdings were at the higher end of the quality spectrum, that sector performed poorly during the three months, and overall, it kept results slightly lower for the year.

The performance was largely due to sector selection during the period. We were significantly overweight in corporate bonds when they performed well, and underweight when they pulled back.

What strategies did you employ?

This fund can invest in bonds throughout the full range of maturities. The fund’s position along that maturity spectrum positively contributed to performance. Early in the period, the fund had a barbell positioning. Specifically, it was overweighted at the long- and short-ends of the maturity spectrum. And it was underweighted at the mid-range. In December, we reduced the fund’s holdings at the long end, and used those proceeds plus money from the fund’s cash position to invest in the mid-range — five-year securities.

Our sector selection benefited performance. In the October to December period, when investors were fearful that a U.S. economic recession was imminent, corporate bonds performed poorly. There were a number of significant defaults, and many near defaults, where bonds lost 30%-40% of their value. During that time, the fund was underweighted in the corporate sector. Instead, we invested in U.S. Treasury and agency debt. Our 10% stake in agency debt worked well, as that was the best performing fixed-income sector during the period. As 2001 began, the Federal Reserve Board initiated an easier monetary policy, lowering interest rates. By that point, corporate bonds had become cheap, and we invested heavily. This

12

EVERGREEN
Fixed Income Fund II
(formerly, Evergreen Select Fixed Income Fund II)
Portfolio Manager Interview

segment of the fixed-income market performed extraordinary well, and we began to lighten our position prior to September 11. Although corporate bonds subsequently gave back some gains, they remained one of the better performing asset classes.

How does this reflect your outlook?

Following the events of September 11, corporate bond spreads widened, meaning the bonds became cheaper in price as their yields increased relative to Treasury yields. We again began buying corporate bonds, concentrating on high-quality issues, while moving out of government and agency debt. We believe that corporate bond spreads are beyond their point at the last recession, and while past performance is no guarantee for future results, it is our opinion that the market has already priced in the worst-case scenario — a long recession. We believe there’s opportunity in high-quality instruments, because as soon as the economy turns the corner, these bonds will appreciate.

The fund also has a significant weighting in the mortgage sector. As interest rates fell over the past nine months, prepayments on mortgage-backed securities, reflecting refinancing activity on mortgages, accelerated appreciably. That dramatically increased the supply of mortgages and the fear of further refinancing activity, which caused mortgage-backed securities to underperform. The group is selling at spread levels that reflect extremely depressed market conditions, and that represents an opportunity. Within the mortgage sector, we believe the fund’s stake in “DUST” (designated underwriting and servicing) bonds has worked well and should continue to do so. These securities are backed by commercial mortgages, typically apartment complexes. They are guaranteed by Fannie Mae or Freddie Mac and have a high level of call protection. That means these bonds continue to appreciate when rates fall, while prepayments act as a cap on the appreciation of other mortgage-backed securities.

What is your outlook for the fixed-income market?

We have a positive outlook for fixed-income securities. We are going into an economic slowdown, but inflation should come down appreciably, which could provide support for bonds. We believe that the bond market will continue to experience volatility, but that volatility creates opportunities. We will continue to watch all sectors of the bond market for the most attractive opportunities.

13

EVERGREEN
Select High Yield Bond Fund
Fund at a Glance as of September 30,  2001

“In this environment, we intend to
continue implementing a
conservative credit strategy,
particularly in light of a possible
recession and rising default rate.”

Portfolio
Management

Richard Cryan
Tenure: November 1999

PERFORMANCE AND RETURNS2
Portfolio Inception Date: 11/30/1999 Class Inception Date	Class I 11/30/1999		Class IS 11/30/1999
Average Annual Returns
1 year	1.51	%	1.25	%
Since Portfolio Inception	2.36	%	2.10	%
30-day SEC Yield	8.66	%	8.36	%
12-month income dividends per share	$0.85		$0.83

Comparison of a $1,000,000 investment in Evergreen Select High Yield Bond Fund, Class I shares², versus a similar investment in the Merrill Lynch High Yield Bond Index (MLHYBI) and the Consumer Price Index (CPI).

The MLHYBI is an unmanaged market index which does not include transaction costs associated with buying and selling securities or any mutual fund expenses. The CPI is a commonly used measure of inflation and does not represent an investment return. It is not possible to invest directly in an index.

CURRENT INVESTMENT STYLE¹

Morningstar’s Style Box is based on a portfolio date as of 9/30/2001.

¹Source: 2001 Morningstar, Inc.

² Past performance is no guarantee of future results. The investment return and principal value of an investment will fluctuate so that investors’ shares, when redeemed, may be worth more or less than their original cost. The performance of each class may vary based on differences in fees and expenses paid by the shareholders investing in each class. Performance includes the reinvestment of income dividends and capital gain distributions.

Class IS shares have a 0.25% 12b-1 expense. Class I shares do not pay 12b-1 fees. The advisor is waiving a portion of its advisory fee. Had the fee not been waived, returns would have been lower.

Class I and IS shares are only available to institutional shareholders with a minimum $1,000,000 investment. Class I and IS shares do not incur sales charges.

The fund’s investment objective is non-fundamental and may be changed without a vote of the fund’s shareholders.

Funds that invest in high yield, lower-rated bonds may contain more risk due to the increased possibility of default.

Foreign investments may contain more risk due to the inherent risk associated with changing political climates, foreign market instability and foreign currency fluctuations.

All data is as of September 30, 2001 and is subject to change.

14

EVERGREEN
Select High Yield Bond Fund
Portfolio Manager Interview

How did the fund perform over the past twelve months?

The fund’s Class I shares returned 1.51% for the twelve-month period ended September 30, 2001, surpassing the -3.33% return produced by the Merrill Lynch High Yield Bond Index. The fund’s stronger performance is particularly notable in light of the fact that unlike a mutual fund, the index incurs no expenses, which reduce returns. An index incurs no expenses, giving it an advantage in generating a higher return.

We attribute the fund’s stronger performance to the successful implementation of our investment strategy, a combination of two concepts: investing only in those companies that demonstrate the ability to generate substantial cash flow and avoiding those companies and industries that need to borrow in the capital markets. The greatest factor contributing to the fund’s stronger performance was its underweighting in the telecommunications sector. Telecommunications, which accounts for approximately 14% of the high yield securities market, experienced a 40% price decline during the period, according to the Merrill Lynch High Yield Bond Index.

Portfolio
Characteristics

(as of 9/30/2001)

Total Net Assets	$152,634,314
Average Credit Quality	BB-
Effective Maturity	7.3 years
Average Duration	4.8 years

What caused the prices of telecommunications bonds to experience such sharp declines?

The securities’ prices were overvalued relative to the financial strength of the underlying companies and when the economy began to show signs of weakness, investors grew increasingly concerned the corporations would not be able to thrive in a slower economic environment. Several factors contributed to these concerns. Many telecommunications companies were in the early stages of development and were experiencing negative operating cash flows. Further, many of them had a significant need for additional capital and, with the decline in stock prices, had both diminished access to capital and few prospects for a sale or merger. As a result, several companies became insolvent.

What else affected high yield bonds?

Credit conditions were difficult because of the economy’s slowdown. Rating agency downgrades exceeded upgrades by a 2:1 margin, and the default rate rose all year. In spite of these conditions, however, the yield premiums provided by high yield bonds over U.S. Treasuries with comparable maturities declined in the first six months of 2001. The decline in yield premiums

15

EVERGREEN
Select High Yield Bond Fund
Portfolio Manager Interview

reflected the superior performance of high yield bonds relative to U.S. Treasuries. The stronger performance continued throughout 2001 until September—a notable accomplishment considering the economy’s weak growth and declining stock prices.

The September 11th tragedy had a significant impact on high yield bonds. The Merrill Lynch High Yield Bond Index fell 6.42% in September, after having risen 7.50%, calendar year-to-date through August 2001. With economic growth already weak, the belief that consumers would retrench and the economy would fall into a recession came to dominate market sentiment. High yield bond prices are sensitive to the economy’s level of activity. As a result, bond prices fell and yields appreciated on the prospect of fewer credit upgrades in an environment of slower economic growth. The sectors most affected by the attack included aerospace, gaming and telecommunications.

What strategies did you use in managing the fund?

We emphasized credit research. The fund’s six credit analysts — dedicated exclusively to high yield securities — monitor and review the fund’s holdings on an ongoing basis. This process enabled the fund to sidestep companies whose businesses appeared to have weaknesses before those weaknesses were reflected in the market price of the corresponding bonds. One example was Federal-Mogul Corp., a supplier of auto components. The fund’s analysts identified an asbestos liability. As a result, we sold the security well in advance of Federal-Mogul filing for bankruptcy.

Our intense focus on credit research also helped us identify sectors that we believed would perform well despite the expected slowdown in the economy. These included gaming and energy. In the gaming industry, we focused on companies with a local customer-base. We particularly liked diversified riverboat companies because of their abundance of free cash flow, and capital spending plans that tended to result in both credit improvement and stable bond prices. In the energy sector, we emphasized exploration and production companies, focusing on natural gas producers. These companies benefited substantially from higher energy prices, prompted in part by the California energy crisis. In contrast, the fund underweighted telecommunications, particularly wireless communications and utilities.

What is your outlook for high yield bonds?

We think the high yield bond market is extremely attractive. The yield advantages provided by high yield bonds over U.S. Treasuries are approaching the peak levels they reached in the early 1990’s. Ironically, at that time, investors were facing the potential of a war in the Middle East, as well as the prospects of a recession. Additional factors existed in the early 1990’s, however, that created a bleaker investment horizon. These factors had the potential to be extremely disruptive to the high yield bond market. They included the bankruptcy of Drexel Burnham Lambert, the chief market-maker for high yield bonds and the prospect of heavy supply flooding the market. The Federal government had demanded that savings and loan companies sell all their high yield bond holdings within a short timeframe. Savings and loans accounted for approximately 7% of the high yield bond market. Further, regulators had encouraged insurance companies to sell their high yield bond holdings.

16

EVERGREEN
Select High Yield Bond Fund
Portfolio Manager Interview

In our opinion, market conditions in the early part of the new millenium appear brighter than a decade ago. We believe several positive factors make current yield advantages extraordinarily attractive, perhaps even approaching once-in-a decade levels of opportunity. We expect liquidity to improve as the Federal Reserve Board continues to revive economic growth. Further, the yield curve is steeply sloped — meaning that longer-term yields are significantly higher than shorter-term yields. Historically, a positively sloped yield curve has been a good indicator of high yield bonds producing returns that are superior to other fixed-income sectors.

The Merrill Lynch Garman Model supports this outlook. The Model measures the degree of relative value provided by high yield bonds. At various times, it issues buy or sell signals, depending on whether the market is oversold or overbought. Recently, the Model signaled a buying opportunity on par with one issued in 1998.

Investors that acted on the 1998 buy signal reaped substantial returns, as in the following year, high yield bonds outperformed their U.S. Treasury counterparts by 10.00%.

In this environment, we intend to continue implementing a conservative credit strategy, particularly in light of a possible recession and rising default rate. We also will seek to minimize risk by keeping the fund extremely diversified. The fund invests in over 100 different bonds and limits its exposure to any one issuer. Further, the largest holdings comprise a maximum of 1% of net assets; and individual industry weightings constitute a combination of no more than 20% of net assets and 2 1/2 times an index weighting. With historically attractive yield advantages, favorable market factors and conservative credit management, we are optimistic about the prospects for high yield bonds in the months ahead, and look forward to identifying opportunities to generate attractive returns.

17

EVERGREEN
Income Plus Fund
(formerly, Evergreen Select Income Plus Fund)
Fund at a Glance as of September 30,  2001

“We believe that the ongoing
volatility and uncertainties in the
financial markets should favor the
performance of higher-quality
bonds over lower-quality bonds.”

Portfolio
Management

Tattersall Team
Tenure: May 2001

PERFORMANCE AND RETURNS2
Portfolio Inception Date: 8/31/1988 Class Inception Date	Class I 11/24/1997		Class IS 3/2/1998
Average Annual Returns
1 year	12.18	%	11.91	%
5 years	7.13	%	6.88	%
10 years	6.92	%	6.66	%
30-day SEC Yield	5.24	%	4.99	%
12-month income dividends per share	0.34		0.33

Comparison of a $1,000,000 investment in Evergreen Income Plus Fund, Class I shares², versus a similar investment in the Lehman Brothers Aggregate Bond Index (LBABI) and the Consumer Price Index (CPI).

The LBABI is an unmanaged market index and does not include transaction costs associated with buying and selling securities or any mutual fund expenses. The CPI is a commonly used measure of inflation and does not represent an investment return. It is not possible to invest directly in an index.

CURRENT INVESTMENT STYLE¹

Morningstar’s Style Box is based on a portfolio date as of 9/30/2001.

¹Source: 2001 Morningstar, Inc.

² Past performance is no guarantee of future results. The investment return and principal value of an investment will fluctuate so that investors’ shares, when redeemed, may be worth more or less than their original cost. The performance of each class may vary based on differences in fees and expenses paid by the shareholders investing in each class. Performance includes the reinvestment of income dividends and capital gain distributions.

Historical performance shown for Class IS shares from 11/24/1997 to its inception is based on the performance of Class I shares and has not been adjusted to reflect the effect of the 0.25% 12b-1 fee applicable to Class IS shares. Class I shares do not pay 12b-1 fees. If these fees had been reflected, returns would have been lower. Prior to 11/24/1997, the returns are based on the fund’s predecessor common trust fund’s (CTF) performance, adjusted for estimated mutual fund expenses. The CTF was not registered under the 1940 Act and was not subject to certain investment restrictions. If the CTF had been registered, its performance might have been adversely affected. The advisor is waiving a portion of its advisory fee. Had the fee not been waived, returns would have been lower.

Class I and IS shares are only available to institutional shareholders with a minimum $1,000,000 investment. Class I and IS shares do not incur sales charges.

The fund’s investment objective is non-fundamental and may be changed without a vote of the fund’s shareholders.

U.S. government guarantees apply only to the underlying securities of the fund’s portfolio and not to the fund’s shares.

Funds that invest in high yield, lower-rated bonds may contain more risk due to the increased possibility of default.

Foreign investments may contain more risk due to the inherent risk associated with changing political climates, foreign market instability and foreign currency fluctuations.

All data is as of September 30, 2001 and is subject to change.

18

EVERGREEN
Income Plus Fund
(formerly, Evergreen Select Income Plus Fund)

Portfolio Manager Interview

How did the fund perform over the past twelve months?

Evergreen Income Plus Fund’s Class I shares recorded a total return of 12.18% for the twelve-month period ended September 30, 2001. That compared to a return of 12.95% for the Lehman Brothers Aggregate Bond Index. At the beginning of the twelve-month period, the fund had a fairly aggressive stake in high-yield, lower-quality bonds. The fund, however, was being restructured, and during the first three months, these holdings were being sold. While the high-yield stake was largely eliminated before the junk bond market declined significantly in December, its holdings still had a negative impact on performance for the first six months.

Portfolio
Characteristics

(as of 9/30/2001)

Total Net Assets	$1,473,241,207
Average Credit Quality	AAA
Effective Maturity	7.2 years
Average Duration	4.6 years

What did this restructuring entail?

As the period began, the fund had very few Treasuries, and a significant stake in lower-quality, BBB-rated bonds. During the first three months of the period, we concentrated on selling that position. At that point, investors were nervous that the U.S. economy was approaching a recession. We invested in U.S. Treasury and agency debt, and underweighted the corporate sector. Our stake in agency securities particularly benefited performance, as that sector was the best performing during the September to December period.

In January, the Federal Reserve Board began to lower interest rates, which eased investors’ recession fears. We began buying corporate bonds with an emphasis on high quality credits. In addition, we added mortgage-backed securities to the portfolio.

These changes worked to the fund’s benefit. However, these allocation shifts were made more gradually than in some of Evergreen’s other funds, owing to the unwinding of the high-yield positions. Therefore, the fund was not able to capture the full move that other funds’ portfolios did.

19

EVERGREEN
Income Plus Fund
(formerly, Evergreen Select Income Plus Fund)
Portfolio Manager Interview

How does this reflect your outlook?

We are making a big commitment to mortgage-backed securities and corporate obligations. Following the events of September 11th, investors’ perceptions shifted back to expecting the U.S. economy to tip into recession. That caused corporate bond spreads to widen once again, creating attractive buying opportunities.

Mortgage-backed securities meanwhile, have also underperformed. As the markets rallied during much of 2001 and interest rates fell, prepayments on mortgage-backed securities, which reflected mortgage refinancing activity, accelerated sharply. That significantly boosted the supply of mortgages, while also increasing the fear of additional refinancing activity, which is why mortgage-backed debt underperformed. That underperformance represents opportunity. We also have dedicated about 10% of assets to so-called DUST (designated underwriting and servicing) bonds. These mortgage-backed securities are Fannie Mae or Freddie Mac insured and guaranteed. They are typically backed by commercial mortgages and have a very high level of call protection. Thus, they have superior appreciation potential to callable bonds, where prepayments can put a cap on performance.

Both mortgage-backed securities and corporate bonds are priced at levels that reflect extremely depressed market conditions. If those conditions do not come to fruition, those spreads could shrink very dramatically, creating an opportunity for positive performance.

What is your outlook?

An economic slowdown is expected, and weakness could continue through a good portion of 2002. However, inflation had already begun to decelerate. The terrorist attacks of September 11th have placed additional pressure on the economy, which should further restrain inflation. A lower inflation environment should be beneficial for bonds going forward. Short-term interest rates could come down slightly, while there is room for long-term rates to decline another 50 basis points or so (a basis point is one-one hundredth of a percentage point).

Volatility is likely to continue in the bond market, but from volatility comes opportunity. We believe that the ongoing volatility and uncertainties in the financial markets should favor the performance of higher-quality bonds over lower-quality bonds. We will continue to favor bonds issued by companies with high credit ratings, as we want to invest in firms that can successfully weather an extended credit cycle.

20

EVERGREEN
Intermediate Term Municipal Bond Fund
(formerly, Evergreen Select Intermediate Term Municipal Bond Fund)
Fund at a Glance as of September 30,  2001

“In this environment, we think the
fund’s long-term emphasis on
income and price stability should
help keep it an attractive
investment alternative.”

Portfolio
Management

Richard K. Marrone
Tenure: November 1997

PERFORMANCE AND RETURNS2
Portfolio Inception Date: 01/31/1984 Class Inception Date	Class I 11/24/1997		Class IS 3/2/1998
Average Annual Returns
1 year	8.05	%	7.78	%
5 years	4.90	%	4.65	%
10 years	5.36	%	5.10	%
30-day SEC Yield	5.15	%	4.90	%
Tax-Equivalent Yield*	8.39	%	7.98	%
12-month income dividends per share	$3.12		$2.97
* Assumes a maximum 38.6% federal tax rate. Results for investors subject to lower tax rates would not be as     advantageous.

Comparison of a $1,000,000 investment in Evergreen Intermediate Term Municipal Bond Fund, Class I shares², versus a similar investment in the Lehman Brothers Municipal Bond 7-Year Index (LBMB7YI) and the Consumer Price Index (CPI).

The LBMB7YI is an unmanaged market index and does not include transaction costs associated with buying and selling securities or any mutual fund expenses. The CPI is a commonly used measure of inflation and does not represent an investment return. It is not possible to invest directly in an index.

CURRENT INVESTMENT STYLE¹

Morningstar’s Style Box is based on a portfolio date as of 9/30/2001.

¹Source: 2001 Morningstar, Inc.

² Past performance is no guarantee of future results. The investment return and principal value of an investment will fluctuate so that investors’ shares, when redeemed, may be worth more or less than their original cost. The performance of each class may vary based on differences in fees and expenses paid by the shareholders investing in each class. Performance includes the reinvestment of income dividends and capital gain distributions.

Historical performance shown for Class IS shares from 11/24/1997 to its inception is based on the performance of Class I shares and has not been adjusted to reflect the effect of the 0.25% 12b-1 fee applicable to Class IS shares. Class I shares do not pay 12b-1 fees. If these fees had been reflected, returns would have been lower. Prior to 11/24/1997, the returns for Class I and IS are based on the fund’s predecessor common trust fund’s (CTF) performance, adjusted for estimated mutual fund expenses. The CTF was not registered under the 1940 Act and was not subject to certain investment restrictions. If the CTF had been registered, its performance might have been adversely affected. The advisor is waiving a portion of its advisory fee. Had the fee not been waived, returns would have been lower.

Class I and IS shares are only available to institutional shareholders with a minimum $1,000,000 investment. Class I and IS shares do not incur sales charges.

The fund’s investment objective is non-fundamental and may be changed without a vote of the fund’s shareholders.

Funds that invest in high yield, lower-rated bonds may contain more risk due to the increased possibility of default.

The fund’s yield will fluctuate, and there can be no guarantee that the fund will achieve its objective or any particular tax-exempt yield. Income may be subject to federal alternative minimum tax.

All data is as of September 30, 2001 and is subject to change.

21

EVERGREEN
Intermediate Term Municipal Bond Fund
(formerly, Evergreen Select Intermediate Term Municipal Bond Fund)
Portfolio Manager Interview

How did the fund perform over the past twelve months?

The fund’s Class I shares returned 8.05% for the twelve-month period ended September 30, 2001, trailing the Lehman Brothers Municipal Bond 7-Year Index of 9.74%. We attribute the lag to a difference in the fund’s objectives compared to those of the index, as well as price declines incurred by the fund’s investment in the airport and airlines sectors in the wake of the September 11, 2001 tragedy. Those sectors appear to have stabilized and begun to improve, as of the close of the fiscal period.

The fund seeks to maximize income and reinforce price stability, whereas the index reflects total return. Bonds selected for income and price stability tend to underperform bonds chosen for their total return potential in a declining interest rate environment, such as the one we experienced over the past year. Conversely, in a steady or rising interest rate environment, bonds with a greater income orientation typically outperform bonds chosen to generate higher total returns. Further, unlike a mutual fund, the index does not incur expenses, which lower returns.

Portfolio
Characteristics

(as of 9/30/2001)

Total Net Assets	$585,782,429
Average Credit Quality	AA
Effective Maturity	7.2 years
Average Duration	5.1 years

What was the investment environment like over the past twelve months?

The environment was favorable, although as one may expect, the prices of airport revenue bonds and securities backed by the airlines fell considerably after September 11th. Securities backed by the airlines incurred sharper price declines than airport revenue bonds, while insured airport and airlines bonds experienced minimal price movement. The period was characterized by the Federal Reserve Board lowering interest rates to reinvigorate the economy. As a result, bonds with maturities five years and shorter outperformed bonds in other maturity ranges. Federal Reserve Board actions, whether they are made to raise or lower interest rates, have a direct effect only on short-term interest rates. While longer-term rates typically are influenced by Fed actions, yields in longer-term maturities are determined in the open market and are influenced by a variety of factors. Intermediate term bond prices did not rise to the degree of their shorter-term counterparts, but they did show solid improvement, outperforming bonds with longer-term maturities.

Supply/demand factors also were favorable. Demand for municipal bonds was substantial because cash flows into the municipal bond market were heavy and supply was limited. Tax-exempt investors received significant principal and interest payments that needed to be reinvested, and many equity investors fled the stock market’s volatility to reinvest in the perceived safety and stability of bonds.

22

EVERGREEN
Intermediate Term Municipal Bond Fund
(formerly, Evergreen Select Intermediate Term Municipal Bond Fund)

Portfolio Manager Interview

What strategies did you use in managing the fund?

We fine-tuned positions, focusing on the fund’s longer-term strategies of maximizing income and reinforcing price stability. With interest rates so low, it has been difficult to find bonds whose yields improve the fund’s distribution yield. Although we selectively invested in new holdings, our strategy primarily took advantage of the market’s strength to sell securities that either no longer met our credit parameters — such as bonds related to hotel taxes and the tourism industry — or were approaching what we believed was their maximum price potential. The fund’s new positions carried higher coupons and intermediate term maturities. Another way we emphasized yield was to engage in tax swaps. In selected situations, we sold securities to offset gains, and then reestablished the positions at higher yields.

What is your outlook over the next six months?

The factors influencing the market appear to be mixed, which could create some choppiness, near term. We think bonds with shorter maturities will still outperform their longer-term counterparts as the Federal Reserve Board continues to stimulate economic growth by lowering interest rates. On the flip side, we also expect supply to increase dramatically — particularly in New York — as rebuilding efforts get underway; and this heavier supply could put downward pressure on prices. In this environment, we think the fund’s long-term emphasis on income and price stability should help keep it an attractive investment alternative. Many positions were established when yields were higher, helping preserve the fund’s yield as interest rates fall. In our opinion, the fund is a particularly attractive alternative compared to individual bonds, which reflect lower, current market rates. Heading forward, we will continue to emphasize income and price stability, seeking opportunities to improve and sustain the fund’s yield.

23

EVERGREEN
Limited Duration Fund
(formerly, Evergreen Select Limited Duration Fund)
Fund at a Glance as of September 30,  2001

“In our view, the stock market and
the long-term bond market may
continue to experience volatility,
and we view limited duration bonds
as a “safe haven” for investors
concerned about the remaining
uncertainty in the financial markets.”

Portfolio
Management

David Fowley Tenure: November 1997	Sam Paddison Tenure: November 1998
Andrew Zimmerman Tenure: November 1998

PERFORMANCE AND RETURNS2
Portfolio Inception Date: 04/30/1994 Class Inception Date	Class I 11/24/1997		Class IS 7/28/1998
Average Annual Returns
1 year	10.51	%	10.24	%
5 years	6.73	%	6.50	%
Since Portfolio Inception	6.44	%	6.20	%
30-day SEC Yield	4.61	%	4.36	%
12-month income dividends per share	$0.67		$0.64

Comparison of a $1,000,000 investment in Evergreen Limited Duration Fund, Class I shares², versus a similar investment in the Lehman Brothers 1-3 Year Government/Credit Index (LB1-3GCI) and the Consumer Price Index (CPI).

The LB1-3GCI is an unmanaged market index and does not include transaction costs associated with buying and selling securities or any mutual fund expenses. The CPI is a commonly used measure of inflation and does not represent an investment return. It is not possible to invest directly in an index.

CURRENT INVESTMENT STYLE¹

Morningstar’s Style Box is based on a portfolio date as of 9/30/2001.

¹Source: 2001 Morningstar, Inc.

² Past performance is no guarantee of future results. The investment return and principal value of an investment will fluctuate so that investors’ shares, when redeemed, may be worth more or less than their original cost. The performance of each class may vary based on differences in fees and expenses paid by the shareholders investing in each class. Performance includes the reinvestment of income dividends and capital gain distributions.

Historical performance shown for Class IS shares from 11/24/1997 to its inception is based on the performance of Class I shares and has not been adjusted to reflect the effect of the 0.25% 12b-1 fee applicable to Class IS shares. Class I shares do not pay 12b-1 fees. If these fees had been reflected, returns would have been lower. Prior to 11/24/1997, the returns are based on the fund’s predecessor common trust fund’s (CTF) performance, adjusted for estimated mutual fund expenses. The CTF was not registered under the 1940 Act and was not subject to certain investment restrictions. If the CTF had been registered, its performance might have been adversely affected. The advisor is waiving a portion of its advisory fee. Had the fee not been waived, returns would have been lower.

Class I and IS shares are only available to institutional shareholders with a minimum $1,000,000 investment. Class I and IS shares do not incur sales charges.

The fund’s investment objective is non-fundamental and may be changed without a vote of the fund’s shareholders.

U.S. government guarantees apply only to the underlying securities of the fund’s portfolio and not to the fund’s shares.

Foreign investments may contain more risk due to the inherent risks associated with changing political climates, foreign market instability and foreign currency fluctuations.

All data is as of September 30, 2001 and is subject to change.

24

EVERGREEN
Limited Duration Fund
(formerly, Evergreen Select Limited Duration Fund)
Portfolio Manager Interview

How did fund perform over the past twelve months?

The fund’s Class I shares returned 10.51% for the twelve-month period ended September 30, 2001. The Lehman Brothers 1-3 Year Government/Credit Index returned 10.75% for the same period. We attribute the fund’s strong relative performance to thorough credit analysis and careful duration management. Duration management involves adjusting the fund’s level of sensitivity to interest rate changes. Lengthening duration increases sensitivity to interest rate changes and conversely, shortening duration enhances price stability.

Portfolio
Characteristics

(as of 9/30/2001)

Total Net Assets	$360,636,981
Average Credit Quality	A+
Effective Maturity	2.2 years
Average Duration	1.7 years

What was the fund’s investment environment like?

The environment was positive. Substantial cash flows created heavy demand, as investors moved money out of the volatile and uncertain stock market and directed proceeds to the relatively stable limited duration segment of the bond market. The increased demand for short-term bonds, combined with the Federal Reserve’s aggressive interest rate cuts, caused a dramatic rise in short-term bond prices and a corresponding drop in yields.

Yield premiums for lower quality bonds widened significantly in response to the slowing economy. Investors were cautious, demanding a higher interest rate to invest in the bonds of corporations whose credit quality had deteriorated. The prices of bonds issued by well-known, high-quality companies rose, pushing yields lower almost to the same degree as the highest quality U. S. Treasury securities. In contrast, bonds issued by lower-quality companies lagged, with investors demanding increasingly higher-yield premiums relative to high quality, well-known corporate bonds. Another sign of the divergence of the high and low quality corporate bond markets was that new high quality bond issuance continued to be very heavy, versus a declining supply of new lower-quality bonds. Lower-quality bonds had limited access to capital markets, due to the reluctance of lenders to extend credit to them as the economy slowed.

25

EVERGREEN
Limited Duration Fund
(formerly, Evergreen Select Limited Duration Fund)

Portfolio Manager Interview

What strategies did you use to manage the fund?

Rigorous credit analysis and careful duration management were important factors in the fund’s strong performance. As prices rose and yields fell throughout the period, the fund’s relatively long duration enhanced its performance. For the majority of the period, the fund’s duration was 100% to 105% of its benchmark’s duration, the Lehman Brothers 1-3 Year Government/Credit Index. In addition, we emphasized sectors that provided higher yields. As the economy began to show weakness, we started to sell any remaining high yield bonds, limiting the fund’s corporate bond exposure to high quality, stable companies. To further protect the fund from the effects of declining corporate profits, we typically ensured diversification of our corporate bond sector by limiting our holdings of any one company to no more than 1% of net assets.

The fund benefited from its significant exposure to corporate bonds because of the incremental yield corporate bonds provide relative to U. S. Treasury bonds. In addition, thorough credit analysis and a focus on the highest quality bonds enabled the fund to avoid any credit problems.

What is your outlook over the next six months?

Our outlook for short-term fixed income securities is cautious. We expect performance to be lackluster as the economy teeters on the brink of recession. We believe interest rates have the potential to rise by mid-2002, particularly if the economy begins to strengthen. Under that scenario we would position the portfolio with a neutral or shorter duration, relative to our benchmark, to protect the fund’s assets from a drop in bond prices caused by the rise in interest rates.

In our view, the stock market and the long-term bond market may continue to experience volatility, and we view limited duration bonds as a “safe haven” for investors concerned about the remaining uncertainty in the financial markets. While a repeat of the steep price appreciation we experienced this past year is unlikely, in our opinion, the short-term bond market could continue to provide good income and stable performance.

26

EVERGREEN
Adjustable Rate Fund
(formerly, Evergreen Select Adjustable Rate Fund)
Financial Highlights

(For a share outstanding throughout each period)

	Year Ended September 30,
	2001 #			2000 (a)
CLASS A
Net asset value, beginning of period	$	9.52		$	9.54
Income from investment operations
Net investment income		0.54			0.16
Net realized and unrealized gains and losses on securities		0.24			(0.02	)
Total from investment operations		0.78			0.14
Distributions to shareholders from
Net investment income		(0.62	)		(0.16	)
Net asset value, end of period	$	9.68		$	9.52
Total return*		8.46	%		1.43	%
Ratios and supplemental data
Net assets, end of period (thousands)	$	190,055		$	26,552
Ratios to average net assets
Expenses‡		0.69	%		0.71	%†
Net investment income		5.70	%		6.54	%†
Portfolio turnover rate		13	%		74	%

	Year Ended September 30,
	2001 #			2000 (a)
CLASS B
Net asset value, beginning of period	$	9.52		$	9.54
Income from investment operations
Net investment income		0.44			0.14
Net realized and unrealized gains and losses on securities		0.27			(0.02	)
Total from investment operations		0.71			0.12
Distributions to shareholders from
Net investment income		(0.55	)		(0.14	)
Net asset value, end of period	$	9.68		$	9.52
Total return*		7.65	%		1.23	%
Ratios and supplemental data
Net assets, end of period (thousands)	$	173,276		$	5,067
Ratios to average net assets
Expenses‡		1.49	%		1.50	%†
Net investment income		4.61	%		5.73	%†
Portfolio turnover rate		13	%		74	%

(a)	For the period from June 30, 2000 (commencement of class operations) to September 30, 2000.
*	Excluding applicable sales charge.
‡	Ratio of expenses to average net assets excludes expense reductions but includes fee waivers.
†	Annualized.
#	Net investment income is based on average shares outstanding during the period.

See Combined Notes to Financial Statements.

27

EVERGREEN
Adjustable Rate Fund
(formerly, Evergreen Select Adjustable Rate Fund)
Financial Highlights

(For a share outstanding throughout each period)

	Year Ended September 30,
	2001 #			2000 (a)
CLASS C
Net asset value, beginning of period	$	9.52		$	9.54
Income from investment operations
Net investment income		0.41			0.14
Net realized and unrealized gains and losses on securities		0.30			(0.02	)
Total from investment operations		0.71			0.12
Distributions to shareholders from
Net investment income		(0.55	)		(0.14	)
Net asset value, end of period	$	9.68		$	9.52
Total return*		7.65	%		1.23	%
Ratios and supplemental data
Net assets, end of period (thousands)	$	348,002		$	3,699
Ratios to average net assets
Expenses‡		1.48	%		1.50	%†
Net investment income		4.40	%		5.73	%†
Portfolio turnover rate		13	%		74	%

	Year Ended September 30,												Year Ended February 28,
	2001 #			2000			1999			1998 (b)			1998			1997 (c)
CLASS I
Net asset value, beginning     of period	$	9.52		$	9.56		$	9.68		$	9.75		$	9.71		$	9.68
Income from investment     operations
Net investment income		0.59			0.61			0.59			0.35			0.64			0.28
Net realized and unrealized gains     and losses on securities		0.21			(0.05	)		(0.12	)		(0.07	)		0.04			0	††
Total from investment operations		0.80			0.56			0.47			0.28			0.68			0.28
Distributions to shareholders     from
Net investment income		(0.64	)		(0.60	)		(0.59	)		(0.35	)		(0.64	)		(0.25	)
Net asset value, end of period	$	9.68		$	9.52		$	9.56		$	9.68		$	9.75		$	9.71
Total return		8.73	%		6.05	%		4.98	%		2.88	%		7.15	%		2.97	%
Ratios and supplemental data
Net assets, end of period     (thousands)	$	140,979		$	32,787		$	36,033		$	23,174		$	25,981		$	70,264
Ratios to average net assets
Expenses‡		0.50	%		0.43	%		0.30	%		0.33	%†		0.30	%		0.30	%†
Net investment income		6.17	%		6.43	%		6.11	%		6.12	%†		6.63	%		6.79	%†
Portfolio turnover rate		13	%		74	%		14	%		46	%		107	%		44	%

(a)	For the period from June 30, 2000 (commencement of class operations) to September 30, 2000.
(b)	For the seven months ended September 30, 1998. The Fund changed its fiscal year end from February 28 to September 30, effective September 30, 1998.
(c)	For the five months ended February 28, 1997. The Fund changed its fiscal year end from September 30 to February 28, effective February 28, 1997.
#	Net investment income is based on average shares outstanding during the period.
‡	Ratio of expenses to average net assets excludes expense reductions but includes fee waivers.
†	Annualized.
††	Amount represents less than $0.01 per share.
*	Excluding applicable sales charge.

See Combined Notes to Financial Statements.

28

EVERGREEN
Adjustable Rate Fund
(formerly, Evergreen Select Adjustable Rate Fund)
Financial Highlights

(For a share outstanding throughout each period)

	Year Ended September 30,												Year Ended February 28,
	2001 #			2000			1999			1998 (a)			1998			1997 (b)
CLASS IS
Net asset value, beginning of period	$	9.52		$	9.56		$	9.68		$	9.76		$	9.72		$	9.68
Income from investment operations
Net investment income		0.55			0.58			0.55			0.33			0.59			0.28
Net realized and unrealized gains or losses
on securities		0.23			(0.04	)		(0.11	)		(0.08	)		0.06			0	††
Total from investment operations		0.78			0.54			0.44			0.25			0.65			0.28
Distributions to shareholders from
Net investment income		(0.62	)		(0.58	)		(0.56	)		(0.33	)		(0.61	)		(0.24	)
Net asset value, end of period	$	9.68		$	9.52		$	9.56		$	9.68		$	9.76		$	9.72
Total return		8.46	%		5.79	%		4.73	%		2.63	%		6.89	%		2.97	%
Ratios and supplemental data
Net assets, end of period (thousands)	$	92,858		$	20,384		$	20,199		$	9,645		$	10,320		$	3,564
Ratios to average net assets
Expenses‡		0.75	%		0.70	%		0.55	%		0.57	%†		0.55	%		0.55	%†
Net investment income		5.72	%		6.18	%		5.86	%		5.82	%†		6.15	%		6.39	%†
Portfolio turnover rate		13	%		74	%		14	%		46	%		107	%		44	%

(a)	For the seven months ended September 30, 1998. The Fund changed its fiscal year end from February 28 to September 30, effective September 30, 1998.
(b)	For the five months ended February 28, 1997. The Fund changed its fiscal year end from September 30 to February 28, effective February 28, 1997.
#	Net investment income is based on average shares outstanding during the period.
‡	Ratio of expenses to average net assets excludes expense reductions but includes fee waivers.
††	Amount represents less than $0.01 per share.
†	Annualized.

See Combined Notes to Financial Statements.

29

EVERGREEN
Core Bond Fund
(formerly, Evergreen Select Core Bond Fund)
Financial Highlights

(For a share outstanding throughout each period)

	Year Ended September 30, 2001 (a) #
CLASS A
Net asset value, beginning of period		$	10.40
Income from investment operations
Net investment income			0.17
Net realized and unrealized gains on securities			0.43
Total from investment operations			0.60
Distributions to shareholders from
Net investment income			(0.22	)
Net asset value, end of period		$	10.78
Total return*			5.86	%
Ratios and supplemental data
Net assets, end of period (thousands)		$	98,424
Ratios to average net assets
Expenses‡			0.68	%†
Net investment income			4.93	%†
Portfolio turnover rate			238	%

	Year Ended September 30, 2001 (a) #
CLASS B
Net asset value, beginning of period		$	10.40
Income from investment operations
Net investment income			0.12
Net realized and unrealized gains on securities			0.45
Total from investment operations			0.57
Distributions to shareholders from
Net investment income			(0.19	)
Net asset value, end of period		$	10.78
Total return*			5.56	%
Ratios and supplemental data
Net assets, end of period (thousands)		$	40,078
Ratios to average net assets
Expenses‡			1.44	%†
Net investment income			4.11	%†
Portfolio turnover rate			238	%

(a)	For the period from May 11, 2001 (commencement of class operations) to September 30, 2001.
#	Net investment income is based on average shares outstanding during the period.
‡	Ratio of expenses to average net assets excludes expense reductions but includes fee waivers.
†	Annualized.
*	Excluding applicable sales charge.

See Combined Notes to Financial Statements.

30

EVERGREEN
Core Bond Fund
(formerly, Evergreen Select Core Bond Fund)
Financial Highlights

(For a share outstanding throughout each period)

	Year Ended September 30, 2001 (a) #
CLASS C
Net asset value, beginning of period		$	10.40
Income from investment operations
Net investment income			0.13
Net realized and unrealized gains on securities			0.44
Total from investment operations			0.57
Distributions to shareholders from
Net investment income			(0.19	)
Net asset value, end of period		$	10.78
Total return*			5.56	%
Ratios and supplemental data
Net assets, end of period (thousands)		$	24,695
Ratios to average net assets
Expenses‡			1.43	%†
Net investment income			4.04	%†
Portfolio turnover rate			238	%

	Year Ended September 30,												Year Ended March 31,
	2001			2000			1999 (b) (c)			1999 (c)			1998 (c)			1997 (c)
CLASS I
Net asset value, beginning     of period	$	10.09		$	10.08		$	10.39		$	10.53		$	9.98		$	10.11
Income from investment     operations
Net investment income		0.62			0.64			0.30			0.59			0.56			0.66
Net realized and unrealized    gains or losses on
securities		0.70			0			(0.30	)		0.09			0.61			(0.12	)
Total from investment     operations		1.32			0.64			0.00			0.68			1.17			0.54
Distributions to     shareholders from
Net investment income		(0.63	)		(0.63	)		(0.30	)		(0.61	)		(0.62	)		(0.67	)
Net realized gains		0			0			(0.01	)		(0.21	)		0			0
Total distributions to     shareholders		(0.63	)		(0.63	)		(0.31	)		(0.82	)		(0.62	)		(0.67	)
Net asset value, end     of period	$	10.78		$	10.09		$	10.08		$	10.39		$	10.53		$	9.98
Total return		13.44	%		6.60	%		0.00	%		0.07	%		12.06	%		5.52	%
Ratios and supplemental     data
Net assets, end of period     (thousands)	$	1,532,324		$	1,283,130		$	1,042,781		$	109,028		$	96,252		$	76,499
Ratios to average net     assets
Expenses‡		0.43	%		0.42	%		0.40	%†		0.50	%		0.50	%		0.50	%
Net investment income		5.96	%		6.45	%		5.70	%†		5.73	%		6.06	%		6.48	%
Portfolio turnover rate		238	%		195	%		225	%		221	%		235	%		207	%

(a)	For the period from May 11, 2001 (commencement of class operations) to September 30, 2001.
(b)	For the six month period ended September 30, 1999. The Fund changed its fiscal year end from March 31 to September 30, effective September 30, 1999.
(c)	On June 4, 1999, Evergreen Core Bond Fund acquired the net assets of the Tattersall Bond Fund. The Tattersall Fund was the accounting and performance survivor in this transaction. The above financial highlights for the periods prior to June 4, 1999 are those of the Tattersall Bond Fund, which have been restated to give effect to this transaction.
#	Net investment income is based on average shares outstanding during the period.
‡	Ratio of expenses to average net assets excludes expense reductions but includes fee waivers.
†	Annualized.
*	Excluding applicable sales charge.

See Combined Notes to Financial Statements.

31

EVERGREEN
Core Bond Fund
(formerly, Evergreen Select Core Bond Fund)
Financial Highlights

(For a share outstanding throughout each period)

	Year Ended September 30,									Year Ended March 31,
	2001			2000			1999 (a) (b)			1999 (b)			1998 (b) (c)
CLASS IS
Net asset value, beginning of period	$	10.09		$	10.08		$	10.40		$	10.54		$	10.40
Income from investment operations
Net investment income		0.61			0.61			0.28			0.59			0.36
Net realized and unrealized gains     or losses on securities		0.68			0			(0.31	)		0.07			0.08
Total from investment operations		1.29			0.61			(0.03	)		0.66			0.44
Distributions to shareholders from
Net investment income		(0.60	)		(0.60	)		(0.28	)		(0.59	)		(0.30	)
Net realized gains		0			0			(0.01	)		(0.21	)		0
Total distributions to shareholders		(0.60	)		(0.60	)		(0.29	)		(0.80	)		(0.30	)
Net asset value, end of period	$	10.78		$	10.09		$	10.08		$	10.40		$	10.54
Total return		13.16	%		6.33	%		(0.17	%)		(0.01	%)		8.55	%
Ratios and supplemental data
Net assets, end of period (thousands)	$	20,456		$	22,213		$	5,744		$	2,721		$	3,069
Ratios to average net assets
Expenses‡		0.68	%		0.68	%		0.61	%†		0.65	%		0.65	%†
Net investment income		5.72	%		6.24	%		5.49	%†		5.59	%		5.96	%†
Portfolio turnover rate		238	%		195	%		225	%		221	%		235	%

(a)	For the six month period ended September 30, 1999. The Fund changed its fiscal year end from March 31 to September 30, effective September 30, 1999.
(b)	On June 4, 1999, Evergreen Core Bond Fund acquired the net assets of the Tattersall Bond Fund. The Tattersall Fund was the accounting and performance survivor in this transaction. The above financial highlights for the periods prior to June 4, 1999 are those of the Tattersall Bond Fund, which have been restated to give effect to this transaction.
(c)	For the period from October 2, 1997 (commencement of class operations) to March 31, 1998.
‡	Ratio of expenses to average net assets excludes expense reductions but includes fee waivers.
†	Annualized.

See Combined Notes to Financial Statements.

32

EVERGREEN
Fixed Income Fund
(formerly, Evergreen Select Fixed Income Fund)
Financial Highlights

(For a share outstanding throughout each period)

	Year Ended September 30,
	2001			2000			1999			1998 (a)
CLASS I
Net asset value, beginning of period	$	5.83		$	5.82		$	6.12		$	5.96
Income from investment operations
Net investment income		0.36			0.37			0.35			0.31
Net realized and unrealized gains or losses     on securities		0.35			0.01			(0.30	)		0.16
Total from investment operations		0.71			0.38			0.05			0.47
Distributions to shareholders from
Net investment income		(0.36	)		(0.37	)		(0.35	)		(0.31	)
Net asset value, end of period	$	6.18		$	5.83		$	5.82		$	6.12
Total return		12.49	%		6.82	%		0.84	%		8.06	%
Ratios and supplemental data
Net assets, end of period (thousands)	$	513,230		$	554,432		$	590,927		$	668,907
Ratios to average net assets
Expenses‡		0.56	%		0.52	%		0.49	%		0.52	%†
Net investment income		5.96	%		6.52	%		5.86	%		5.99	%†
Portfolio turnover rate		187	%		37	%		63	%		46	%

	Year Ended September 30,
	2001			2000			1999			1998 (b)
CLASS IS
Net asset value, beginning of period	$	5.83		$	5.82		$	6.12		$	5.97
Income from investment operations
Net investment income		0.34			0.36			0.33			0.20
Net realized and unrealized gains or losses     on securities		0.35			0.01			(0.30	)		0.15
Total from investment operations		0.69			0.37			0.03			0.35
Distributions to shareholders from
Net investment income		(0.34	)		(0.36	)		(0.33	)		(0.20	)
Net asset value, end of period	$	6.18		$	5.83		$	5.82		$	6.12
Total return		12.21	%		6.55	%		0.59	%		5.94	%
Ratios and supplemental data
Net assets, end of period (thousands)	$	14,163		$	12,709		$	11,590		$	9,808
Ratios to average net assets
Expenses‡		0.81	%		0.78	%		0.74	%		0.77	%†
Net investment income		5.70	%		6.26	%		5.65	%		5.65	%†
Portfolio turnover rate		187	%		37	%		63	%		46	%

(a)	For the period from November 24, 1997 (commencement of class operations) to September 30, 1998.
(b)	For the period from March 9, 1998 (commencement of class operations) to September 30, 1998.
†	Annualized.
‡	Ratio of expenses to average net assets excludes expense reductions but includes fee waivers.

See Combined Notes to Financial Statements.

33

EVERGREEN
Fixed Income Fund II
(formerly, Evergreen Select Fixed Income Fund II)
Financial Highlights

(For a share outstanding throughout each period)

	Year Ended September 30,						Year Ended October 31,
	2001			2000 (b)			1999			1998			1997			1996
CLASS I (a)
Net asset value, beginning     of period	$	12.18		$	12.38		$	13.15		$	13.11		$	12.89		$	13.71
Income from investment     operations
Net investment income		0.80			0.80			0.78			0.79			0.83			0.77
Net realized and unrealized     gains or losses on securities,     interest rate swaps and futures     contracts		0.70			(0.08	)		(0.66	)		0.13			0.21			(0.16	)
Total from investment     operations		1.50			0.72			0.12			0.92			1.04			0.61
Distributions to shareholders     from
Net investment income		(0.84	)		(0.92	)		(0.77	)		(0.82	)		(0.82	)		(0.77	)
Net realized gains		0			0			(0.12	)		(0.06	)		0			(0.66	)
Total distributions to     shareholders		(0.84	)		(0.92	)		(0.89	)		(0.88	)		(0.82	)		(1.43	)
Net asset value, end     of period	$	12.84		$	12.18		$	12.38		$	13.15		$	13.11		$	12.89
Total return		12.63	%		6.08	%		0.97	%		7.21	%		8.39	%		4.87	%
Ratios and supplemental data
Net assets, end of period     (thousands)	$	45,060		$	60,729		$	77,470		$	83,372		$	61,738		$	49,962
Ratios to average net assets
Expenses‡		0.14	%		0.11	%†		0.10	%		0.10	%		0.15	%		0.17	%
Net investment income		6.40	%		6.86	%†		6.16	%		6.08	%		6.52	%		6.22	%
Portfolio turnover rate		192	%		113	%		209	%		137	%		194	%		226	%

	Year Ended September 30,						Period Ended October 31, 1999 (c)
	2001			2000 (b)
CLASS IS
Net asset value, beginning of period	$	12.17		$	12.38			$	12.25
Income from investment operations
Net investment income		0.77			0.74				0.03
Net realized and unrealized gains or losses on securities,     interest rate swaps and futures contracts		0.71			(0.06	)			0.10
Total from investment operations		1.48			0.68				0.13
Distributions to shareholders from
Net investment income		(0.83	)		(0.89	)			0
Net asset value, end of period	$	12.82		$	12.17			$	12.38
Total return		12.45	%		5.76	%			1.06	%
Ratios and supplemental data
Net assets, end of period (thousands)	$	1		$	1			$	1
Ratios to average net assets
Expenses‡		0.36	%		0.39	%†			0.39	%†
Net investment income		6.17	%		7.18	%†			6.86	%†
Portfolio turnover rate		192	%		113	%			209	%

(a)	Effective October 18, 1999, shareholders of Mentor Fixed Income Portfolio became owners of that number of full and fractional shares of Class I of Evergreen Fixed Income Fund II.
(b)	For the eleven months ended September 30, 2000. The Fund changed its fiscal year end from October 31 to September 30, effective September 30, 2000.
(c)	For the period from October 18, 1999 (commencement of class operations) to October 31, 1999.
†	Annualized.
‡	Ratio of expenses to average net assets excludes expense reductions.

See Combined Notes to Financial Statements.

34

EVERGREEN
Select High Yield Bond Fund
Financial Highlights

(For a share outstanding throughout each period)

	Year Ended September 30,
	2001#			2000 (a)
CLASS I
Net asset value, beginning of period	$	9.57		$	10.00
Income from investment operations
Net investment income		0.79			0.71
Net realized and unrealized losses on securities		(0.64	)		(0.44	)
Total from investment operations		0.15			0.27
Distributions to shareholders from
Net investment income		(0.85	)		(0.70	)
Net asset value, end of period	$	8.87		$	9.57
Total return		1.51	%		2.82	%
Ratios and supplemental data
Net assets, end of period (thousands)	$	152,633		$	75,204
Ratios to average net assets
Expenses‡		0.63	%		0.61	%†
Net investment income		8.52	%		8.98	%†
Portfolio turnover rate		79	%		48	%

	Year Ended September 30,
	2001#			2000 (a)
CLASS IS
Net asset value, beginning of period	$	9.57		$	10.00
Income from investment operations
Net investment income		0.78			0.71
Net realized and unrealized losses on securities		(0.65	)		(0.47	)
Total from investment operations		0.13			0.24
Distributions to shareholders from
Net investment income		(0.83	)		(0.67	)
Net asset value, end of period	$	8.87		$	9.57
Total return		1.25	%		2.59	%
Ratios and supplemental data
Net assets, end of period (thousands)	$	1		$	1
Ratios to average net assets
Expenses‡		0.81	%		0.56	%†
Net investment income		8.40	%		8.89	%†
Portfolio turnover rate		79	%		48	%

(a)	For the period from November 30, 1999 (commencement of class operations) to September 30, 2000.
†	Annualized.
‡	Ratio of expenses to average net assets excludes expense reductions but includes fee waivers.
#	Net investment income per share is based on average shares outstanding during the period.

See Combined Notes to Financial Statements.

35

EVERGREEN
Income Plus Fund
(formerly, Evergreen Select Income Plus Fund)
Financial Highlights

(For a share outstanding throughout each period)

	Year Ended September 30,
	2001			2000			1999			1998 (a)
CLASS I
Net asset value, beginning of period	$	5.36		$	5.41		$	5.92		$	5.72
Income from investment operations
Net investment income		0.33			0.35			0.33			0.30
Net realized and unrealized gains or losses     on securities		0.30			(0.05	)		(0.46	)		0.20
Total from investment operations		0.63			0.30			(0.13	)		0.50
Distributions to shareholders from
Net investment income		(0.34	)		(0.35	)		(0.33	)		(0.30	)
Net realized gains		0			0			(0.05	)		0
Total distributions to shareholders		(0.34	)		(0.35	)		(0.38	)		(0.30	)
Net asset value, end of period	$	5.65		$	5.36		$	5.41		$	5.92
Total return		12.18	%		5.82	%		(2.13	%)		8.99	%
Ratios and supplemental data
Net assets, end of period (thousands)	$	1,449,337		$	1,568,819		$	1,794,209		$	1,367,240
Ratios to average net assets
Expenses‡		0.52	%		0.51	%		0.48	%		0.51	%†
Net investment income		6.10	%		6.68	%		5.95	%		6.09	%†
Portfolio turnover rate		177	%		40	%		70	%		37	%

	Year Ended September 30,
	2001			2000			1999			1998 (b)
CLASS IS
Net asset value, beginning of period	$	5.36		$	5.41		$	5.92		$	5.71
Income from investment operations
Net investment income		0.32			0.34			0.32			0.19
Net realized and unrealized gains or losses     on securities		0.30			(0.05	)		(0.46	)		0.21
Total from investment operations		0.62			0.29			(0.14	)		0.40
Distributions to shareholders from
Net investment income		(0.33	)		(0.34	)		(0.32	)		(0.19	)
Net realized gains		0			0			(0.05	)		0
Total distributions to shareholders		(0.33	)		(0.34	)		(0.37	)		(0.19	)
Net asset value, end of period	$	5.65		$	5.36		$	5.41		$	5.92
Total return		11.91	%		5.57	%		(2.36	%)		7.21	%
Ratios and supplemental data
Net assets, end of period (thousands)	$	23,904		$	16,285		$	10,871		$	7,528
Ratios to average net assets
Expenses‡		0.77	%		0.77	%		0.73	%		0.75	%†
Net investment income		5.81	%		6.47	%		5.74	%		5.80	%†
Portfolio turnover rate		177	%		40	%		70	%		37	%

(a)	For the period from November 24, 1997 (commencement of class operations) to September 30, 1998.
(b)	For the period from March 2, 1998 (commencement of class operations) to September 30, 1998.
†	Annualized.
‡	Ratio of expenses to average net assets excludes expense reduction but includes fee waivers.

See Combined Notes to Financial Statements.

36

EVERGREEN
Intermediate Term Municipal Bond Fund
(formerly, Evergreen Select Intermediate Term Municipal Bond Fund)
Financial Highlights

(For a share outstanding throughout each period)

	Year Ended September 30,
	2001			2000			1999			1998 (a)
CLASS I
Net asset value, beginning of period	$	60.44		$	61.33		$	67.11		$	64.84
Income from investment operations
Net investment income		3.12			2.99			2.97			2.57
Net realized and unrealized gains or losses     on securities		1.64			(0.89	)		(4.89	)		2.27
Total from investment operations		4.76			2.10			(1.92	)		4.84
Distributions to shareholders from
Net investment income		(3.12	)		(2.99	)		(2.97	)		(2.57	)
Net realized gains		0			0			(0.89	)		0
Total distributions to shareholders		(3.12	)		(2.99	)		(3.86	)		(2.57	)
Net asset value, end of period	$	62.08		$	60.44		$	61.33		$	67.11
Total return		8.05	%		3.58	%		(3.00	%)		7.61	%
Ratios and supplemental data
Net assets, end of period (thousands)	$	576,388		$	611,279		$	704,474		$	746,874
Ratios to average net assets
Expenses‡		0.62	%		0.63	%		0.57	%		0.62	%†
Net investment income		5.07	%		4.98	%		4.59	%		4.59	%†
Portfolio turnover rate		37	%		66	%		97	%		47	%

	Year Ended September 30,
	2001			2000			1999			1998 (b)
CLASS IS
Net asset value, beginning of period	$	60.44		$	61.33		$	67.11		$	65.91
Income from investment operations
Net investment income		2.97			2.84			2.81			1.66
Net realized and unrealized gains or losses     on securities		1.64			(0.89	)		(4.89	)		1.20
Total from investment operations		4.61			1.95			(2.08	)		2.86
Distributions to shareholders from
Net investment income		(2.97	)		(2.84	)		(2.81	)		(1.66	)
Net realized gains		0			0			(0.89	)		0
Total distributions to shareholders		(2.97	)		(2.84	)		(3.70	)		(1.66	)
Net asset value, end of period	$	62.08		$	60.44		$	61.33		$	67.11
Total return		7.78	%		3.32	%		(3.24	%)		4.41	%
Ratios and supplemental data
Net assets, end of period (thousands)	$	9,394		$	7,760		$	5,863		$	4,736
Ratios to average net assets
Expenses‡		0.88	%		0.88	%		0.83	%		0.89	%†
Net investment income		4.83	%		4.77	%		4.41	%		4.35	%†
Portfolio turnover rate		37	%		66	%		97	%		47	%

(a)	For the period from November 24, 1997 (commencement of class operations) to September 30, 1998.
(b)	For the period form March 2, 1998 (commencement of class operations) to September 30, 1998.
†	Annualized.
‡	Ratio of expenses to average net assets excludes expense reductions but includes fee waivers.

See Combined Notes to Financial Statements.

37

EVERGREEN
Limited Duration Fund
(formerly, Evergreen Select Limited Duration Fund)
Financial Highlights

(For a share outstanding throughout each period)

	Year Ended September 30,
	2001#			2000			1999			1998 (a) #
CLASS I
Net asset value, beginning of period	$	10.18		$	10.21		$	10.52		$	10.42
Income from investment operations
Net investment income		0.62			0.67			0.60			0.53
Net realized and unrealized gains or losses     on securities		0.42			(0.04	)		(0.29	)		0.10
Total from investment operations		1.04			0.63			0.31			0.63
Distributions to shareholders from
Net investment income		(0.67	)		(0.66	)		(0.60	)		(0.53	)
Net realized gains		0			0			(0.02	)		0
Total distributions to shareholders		(0.67	)		(0.66	)		(0.62	)		(0.53	)
Net asset value, end of period	$	10.55		$	10.18		$	10.21		$	10.52
Total return		10.51	%		6.42	%		3.07	%		6.21	%
Ratios and supplemental data
Net assets, end of period (thousands)	$	331,219		$	282,827		$	312,157		$	70,810
Ratios to average net assets
Expenses‡		0.27	%		0.30	%		0.31	%		0.30	%†
Net investment income		6.06	%		6.61	%		5.88	%		5.97	%†
Portfolio turnover rate		116	%		62	%		147	%		78	%

	Year Ended September 30,
	2001#			2000			1999			1998 (b) #
CLASS IS
Net asset value, beginning of period	$	10.18		$	10.21		$	10.52		$	10.41
Income from investment operations
Net investment income		0.59			0.64			0.58			0.11
Net realized and unrealized gains or losses     on securities		0.42			(0.03	)		(0.29	)		0.11
Total from investment operations		1.01			0.61			0.29			0.22
Distributions to shareholders from
Net investment income		(0.64	)		(0.64	)		(0.58	)		(0.11	)
Net realized gains		0			0			(0.02	)		0
Total distributions to shareholders		(0.64	)		(0.64	)		(0.60	)		(0.11	)
Net asset value, end of period	$	10.55		$	10.18		$	10.21		$	10.52
Total return		10.24	%		6.15	%		2.81	%		2.12	%
Ratios and supplemental data
Net assets, end of period (thousands)	$	29,418		$	9,148		$	1,629		$	614
Ratios to average net assets
Expenses‡		0.52	%		0.54	%		0.56	%		0.55	%†
Net investment income		5.76	%		6.45	%		5.67	%		5.84	%†
Portfolio turnover rate		116	%		62	%		147	%		78	%

(a)	For the period from November 24, 1997 (commencement of class operations) to September 30, 1998.
(b)	For the period from July 28, 1998 (commencement of class operations) to September 30, 1998.
†	Annualized.
#	Net investment income is based on average shares outstanding during the period.
‡	Ratio of expenses to average net assets excludes expense reductions but includes fee waivers.

See Combined Notes to Financial Statements.

38

EVERGREEN
Adjustable Rate Fund
(formerly, Evergreen Select Adjustable Rate Fund)
Schedule of Investments

September 30, 2001

	Credit Rating^	Principal Amount		Value
COLLATERALIZED MORTGAGE OBLIGATIONS–16.5%
FHLMC:
4.40%, 04/15/2024	AAA	$	4,429,849	$	4,407,272
6.00%, 12/15/2011	AAA		42,062,174		42,797,602
6.50%, 04/15/2014	AAA		18,200,388		18,533,281
FNMA:
4.50%, 04/25/2022	AAA		2,714,156		2,732,752
5.22%, 10/25/2017	AAA		13,040,862		13,143,479
5.27%, 03/25/2009	AAA		9,632,609		9,958,351
5.47%, 01/25/2022	AAA		9,400,000		9,470,306
6.00%, 06/25/2027	AAA		30,167,816		30,969,816
7.50%, 07/25/2022	AAA		8,456,333		9,105,710
9.00%, 12/25/2019	AAA		993,744		1,061,037
GNMA, 6.50%, 05/16/2026	AAA		13,673,669		13,643,368
Total Collateralized Mortgage Obligations					155,822,974
MORTGAGE-BACKED SECURITIES–71.9%
FHLMC:
5.27%, 01/15/2023	AAA		1,416,085		1,426,270
5.94%, 08/01/2031	AAA		5,358,690		5,419,020
6.16%, 06/01/2031	AAA		19,797,939		20,307,884
6.35%, 04/01/2031	AAA		2,853,101		2,926,590
6.36%, 07/01/2029	AAA		565,682		500,276
6.50%, 08/15/2031	AAA		11,520,000		11,660,314
6.61%, 03/01/2027	AAA		14,380,340		14,827,481
6.67%, 06/01/2017	AAA		172,887		175,831
6.72%, 02/01/2027	AAA		5,956,327		6,155,405
6.75%, 01/01/2017	AAA		34,403		34,996
6.76%, 04/01/2020	AAA		328,608		340,047
6.80%, 06/01/2024	AAA		111,966		114,665
6.84%, 05/01/2022	AAA		488,615		496,326
6.85%, 07/01/2019	AAA		225,414		229,746
7.00%, 03/01/2021-07/01/2030	AAA		1,653,204		1,689,153
7.07%, 08/01/2023	AAA		217,088		224,024
7.21%, 09/01/2028	AAA		3,461,641		3,641,971
7.23%, 04/01/2022	AAA		2,416,148		2,470,230
7.24%, 10/01/2018-02/01/2031	AAA		17,597,863		18,157,527
7.25%, 11/01/2008	AAA		5,679		5,742
7.29%, 05/01/2019	AAA		27,938		28,845
7.31%, 09/01/2017	AAA		883,878		901,548
7.33%, 02/01/2028	AAA		429,212		441,430
7.36%, 10/01/2016	AAA		181,223		184,325
7.39%, 07/01/2031	AAA		20,000,000		20,625,000
7.41%, 03/01/2022-11/01/2029	AAA		2,557,309		2,607,063
7.49%, 03/01/2023	AAA		69,175		71,991

39

EVERGREEN
Adjustable Rate Fund
(formerly, Evergreen Select Adjustable Rate Fund)
Schedule of Investments (continued)

September 30, 2001

	Credit Rating^	Principal Amount		Value
MORTGAGE-BACKED SECURITIES–continued
FHLMC–continued:
7.53%, 07/01/2023	AAA	$	1,168,106	$	1,222,986
7.61%, 06/01/2024	AAA		312,519		327,293
7.63%, 03/01/2018	AAA		293,496		299,879
7.67%, 02/01/2021	AAA		618,120		635,012
7.69%, 04/01/2023	AAA		986,046		1,030,902
7.70%, 06/01/2016	AAA		2,433,290		2,451,835
7.74%, 01/01/2022	AAA		1,750,086		1,790,337
7.79%, 10/01/2023	AAA		1,584,412		1,662,272
7.80%, 11/01/2021	AAA		1,138,544		1,167,279
7.87%, 11/01/2023	AAA		1,854,195		1,944,504
7.88%, 03/01/2019-10/01/2023	AAA		2,332,864		2,430,664
7.90%, 05/01/2020	AAA		36,485		38,204
8.00%, 08/01/2024	AAA		135,529		144,789
8.24%, 05/01/2026	AAA		2,096,035		2,201,218
8.35%, 10/01/2021	AAA		562,338		576,462
8.50%, 11/01/2021-03/01/2023	AAA		1,149,396		1,237,058
9.75%, 03/01/2016	AAA		294,417		316,188
10.50%, 04/01/2004-10/01/2005	AAA		72,815		75,403
FNMA:
5.47%, 07/01/2029	AAA		1,385,893		1,422,818
5.52%, 06/01/2020	AAA		1,960,865		2,015,601
5.75%, 08/01/2015-02/01/2019	AAA		8,101,851		8,252,694
5.77%, 01/01/2018	AAA		3,707,051		3,812,134
5.81%, 04/01/2018	AAA		2,458,571		2,520,118
5.85%, 03/01/2015	AAA		423,954		427,677
5.88%, 01/01/2019	AAA		1,735,652		1,784,164
5.89%, 02/01/2031	AAA		1,425,153		1,444,054
5.91%, 02/01/2031	AAA		9,131,030		9,252,134
6.00%, 03/01/2018	AAA		230,507		234,098
6.22%, 06/01/2034	AAA		6,424,483		6,573,579
6.30%, 06/01/2030-12/01/2040	AAA		81,916,399		83,818,163
6.37%, 03/01/2006	AAA		3,799,941		3,926,629
6.43%, 11/01/2039	AAA		6,279,541		6,510,034
6.45%, 09/01/2031	AAA		25,317,152		26,045,020
6.46%, 07/01/2021-08/01/2031	AAA		64,268,845		66,021,810
6.49%, 04/01/2031	AAA		11,471,579		11,751,199
6.50%, 06/01/2018	AAA		151,192		156,468
6.51%, 01/01/2016	AAA		641,494		656,414
6.52%, 03/01/2027	AAA		2,927,239		2,995,369
6.53%, 03/01/2027	AAA		522,091		529,624
6.55%, 05/01/2027	AAA		7,594,611		7,895,435
6.57%, 12/01/2026-10/01/2030	AAA		4,623,227		4,746,145
6.58%, 07/01/2020	AAA		264,039		270,572
6.64%, 07/01/2027	AAA		346,554		352,260

40

EVERGREEN
Adjustable Rate Fund
(formerly, Evergreen Select Adjustable Rate Fund)
Schedule of Investments (continued)

September 30, 2001

	Credit Rating^	Principal Amount		Value
MORTGAGE-BACKED SECURITIES–continued
FNMA–continued:
6.69%, 04/01/2028	AAA	$	5,408,865	$	5,575,567
6.70%, 01/01/2023	AAA		660,356		676,418
6.71%, 09/01/2018-11/01/2018	AAA		1,643,584		1,685,026
6.77%, 10/01/2016	AAA		325,975		334,114
6.78%, 07/01/2027	AAA		1,118,578		1,162,484
6.80%, 10/01/2017	AAA		298,649		303,552
6.90%, 02/01/2017-05/01/2022	AAA		2,070,935		2,113,944
6.91%, 03/01/2019	AAA		103,545		105,461
6.93%, 07/01/2023-06/01/2027	AAA		10,422,892		10,748,716
6.95%, 05/01/2036	AAA		806,140		828,707
6.96%, 09/01/2030	AAA		9,543,953		9,781,647
6.98%, 10/01/2028	AAA		18,146,723		18,793,200
6.99%, 11/01/2017-04/01/2038	AAA		3,584,800		3,669,729
7.00%, 08/01/2017	AAA		185,817		191,792
7.02%, 12/01/2017	AAA		590,357		600,809
7.03%, 09/01/2021	AAA		7,375,303		7,519,813
7.11%, 04/01/2028	AAA		4,680,165		4,812,063
7.12%, 07/01/2015-12/01/2030	AAA		19,070,074		19,729,517
7.13%, 09/01/2018-01/01/2031	AAA		2,689,334		2,752,062
7.15%, 03/01/2030	AAA		5,722,893		5,904,035
7.17%, 12/01/2022	AAA		230,050		233,630
7.18%, 08/01/2028	AAA		18,237,757		18,784,890
7.19%, 01/01/2027	AAA		7,561,291		7,835,388
7.20%, 04/01/2025-06/01/2026	AAA		1,459,902		1,498,466
7.22%, 01/01/2017	AAA		4,392,593		4,537,510
7.27%, 01/01/2022	AAA		560,217		572,223
7.32%, 09/01/2026	AAA		2,059,395		2,105,922
7.33%, 07/01/2025	AAA		479,739		491,136
7.36%, 08/01/2025-02/01/2032	AAA		3,635,393		3,730,599
7.37%, 10/01/2031	AAA		4,928,320		5,066,929
7.44%, 12/01/2019-07/01/2030	AAA		16,635,475		17,148,765
7.47%, 08/01/2027	AAA		6,122,199		6,294,931
7.48%, 08/01/2030	AAA		10,493,145		10,827,614
7.49%, 11/01/2024	AAA		8,161,764		8,327,774
7.50%, 07/25/2028	AAA		1,641,272		1,712,282
7.51%, 12/01/2021-08/01/2030	AAA		14,287,768		14,733,217
7.52%, 07/01/2030@	AAA		9,964,696		10,266,751
7.53%, 01/01/2030	AAA		5,411,398		5,583,886
7.54%, 12/01/2023	AAA		1,688,710		1,768,730
7.60%, 07/01/2019	AAA		118,592		121,118
7.65%, 08/01/2027	AAA		5,811,863		5,960,603
7.66%, 12/01/2029	AAA		2,531,074		2,618,080
7.69%, 02/01/2027	AAA		398,065		409,586

41

EVERGREEN
Adjustable Rate Fund
(formerly, Evergreen Select Adjustable Rate Fund)
Schedule of Investments (continued)

September 30, 2001

	Credit Rating^	Principal Amount		Value
MORTGAGE-BACKED SECURITIES–continued
FNMA–continued:
7.71%, 06/01/2026	AAA	$	1,549,311	$	1,606,374
7.74%, 02/01/2026	AAA		917,648		950,904
7.77%, 07/01/2028	AAA		11,267,920		11,669,339
7.80%, 06/01/2024	AAA		301,735		310,203
7.86%, 12/01/2024-05/01/2027	AAA		4,089,603		4,243,951
7.89%, 01/01/2025	AAA		1,404,980		1,459,423
8.01%, 04/01/2024	AAA		458,906		470,563
8.08%, 01/01/2022	AAA		211,600		217,165
8.12%, 06/01/2019-12/01/2024	AAA		584,630		606,281
8.44%, 07/01/2024	AAA		708,549		732,960
8.50%, 04/01/2026-06/01/2030	AAA		3,035,737		3,243,947
9.00%, 05/01/2021-02/01/2025	AAA		1,825,015		1,995,789
9.50%, 04/01/2005-05/01/2007	AAA		249,745		258,511
10.50%, 11/01/2019	AAA		750,167		828,062
10.75%, 10/01/2012	AAA		255,857		282,606
11.00%, 01/01/2016-01/01/2018	AAA		405,194		456,783
12.50%, 07/01/2015	AAA		531,408		616,484
GNMA:
6.00%, 01/20/2030	AAA		2,429,817		2,475,116
6.375%, 02/20/2016-05/20/2026	AAA		10,645,459		10,898,099
7.50%, 02/20/2023-11/20/2023	AAA		527,531		552,315
7.625%, 12/20/2017-10/20/2027	AAA		5,049,466		5,220,249
7.75%, 08/20/2015-07/20/2024	AAA		3,368,630		3,473,709
9.00%, 05/15/2016-08/15/2021	AAA		3,841,305		4,207,869
9.50%, 08/15/2018-12/15/2021	AAA		3,373,114		3,752,040
10.25%, 11/15/2029@	AAA		2,532,268		2,551,260
Total Mortgage-Backed Securities					679,628,886
U.S. TREASURY OBLIGATIONS–1.4%
U.S. Treasury Notes:
4.625%, 05/15/2006	AAA		10,000,000		10,356,260
4.75%, 01/15/2010	AAA		2,638,275		2,848,514
Total U.S. Treasury Obligations					13,204,774
		Shares		Value
SHORT-TERM INVESTMENTS–11.5%
MUTUAL FUND SHARES–11.5%
Evergreen Institutional Money Market Fund ø			109,048,010		109,048,010
Total Investments–(cost $949,994,095)–101.3%					957,704,644
Other Assets and Liabilities–(1.3%)					(12,535,059	)
Net Assets–100.0%				$	945,169,585

See Combined Notes to Schedules of Investments.

42

EVERGREEN
Core Bond Fund
(formerly, Evergreen Select Core Bond Fund)
Schedule of Investments

September 30, 2001

	Credit Rating^	Principal Amount		Value
ASSET-BACKED SECURITIES–1.1%
Comed Transitional Funding Trust, Ser. 1998-1, Class A7, 5.74%,
12/25/2010	AAA	$	9,750,000	$	10,104,964
Federal Express Corp. Pass Through Certs., Ser. 981A, 6.72%,
01/15/2022	AAA		9,027,296		8,660,652
Total Asset-Backed Securities					18,765,616
COLLATERALIZED MORTGAGE OBLIGATIONS–9.5%
Commerce 2000, Ser. C1, Class A2, 7.42%, 04/15/2010	AAA		11,650,000		12,852,371
Comml. Mtge. Asset Trust, Ser. 1999-C1, Class A3, 6.64%,
09/17/2010	AAA		9,170,000		9,768,686
Credit Suisse First Boston Mtge., 7.325%, 07/15/2008	AAA		6,783,188		7,379,056
FHLMC:
Ser. 1961, Class H, 6.50%, 05/15/2012	AAA		8,490,000		8,853,652
Ser. 2115, Class PE, 6.00%, 01/15/2014	AAA		20,791,000		21,167,629
Ser. 2123, Class PE, 6.00%, 12/15/2027	AAA		6,680,000		6,744,028
FNMA:
Ser. 1994-72, Class J, 6.00%, 06/25/2023	AAA		6,070,000		6,187,079
Ser. 1996-21, Class PJ, 6.00%, 12/25/2010	AAA		7,427,600		7,652,099
Ser. 1999-6, Class PB, 6.00%, 03/25/2019	AAA		7,385,000		7,428,908
Ser. 2111, Class TC, 6.00%, 10/15/2010	AAA		7,415,000		7,694,509
Ser. 2143 Class CB, 6.00%, 12/15/2024	AAA		6,850,000		7,004,159
Ser. G92-23, Class Z, 7.50%, 05/25/2021	AAA		1,566,995		1,691,984
Ser. G92-44, Class Z, 8.00%, 07/25/2022	AAA		986,550		1,038,412
GMAC Comml. Mtge. Securities, Inc., Ser. 1998-C2, Class A1,
6.15%, 11/15/2007	AAA		9,497,798		9,911,848
Lehman Brothers Comml. Conduit Mtge. Trust, Ser. 1999-C2,
Class A1, 7.11%, 07/15/2008	Aaa		18,449,217		19,852,101
Morgan Stanley Capital I, Inc.:
Ser. 1998-XL1, Class A3, 6.48%, 06/03/2030	AAA		12,490,000		13,202,166
Ser. 1998-XL2, 6.17%, 10/03/2008	AAA		14,620,000		15,156,310
Total Collateralized Mortgage Obligations					163,584,997
CORPORATE BONDS–29.2%
CONSUMER DISCRETIONARY–4.7%
Auto Components–0.9%
Delphi Automotive Systems Corp., 6.125%, 05/01/2004	BBB		14,100,000		14,483,379
Automobiles–2.4%
Ford Motor Co.:
5.80%, 01/12/2009	A		18,230,000		17,116,931
6.375%, 02/01/2029	A		15,230,000		12,520,689
General Motors Corp., 7.20%, 01/15/2011	A		11,750,000		11,965,613
					41,603,233

43

EVERGREEN
Core Bond Fund
(formerly, Evergreen Select Core Bond Fund)
Schedule of Investments (continued)

September 30, 2001

	Credit Rating^	Principal Amount		Value
CORPORATE BONDS–continued
CONSUMER DISCRETIONARY–continued
Multi-line Retail–1.4%
May Department Stores Co., 8.75%, 05/15/2029	A+	$	7,690,000	$	8,950,491
Sears Roebuck Acceptance Corp., 7.00%, 02/01/2011	A-		8,300,000		8,165,424
Wal-Mart Stores, Inc., 6.875%, 08/10/2009	AA		7,000,000		7,591,227
					24,707,142
CONSUMER STAPLES–2.3%
Beverages–1.7%
Coca Cola Enterprises, Inc.:
6.125%, 08/15/2011	A		9,000,000		9,140,526
6.75%, 01/15/2038	A		5,715,000		5,543,076
8.50%, 02/01/2022	A		4,200,000		4,907,280
Pepsi Bottling Group, Inc., 7.00%, 03/01/2029	A-		9,890,000		10,240,571
					29,831,453
Food & Drug Retailing–0.6%
Safeway, Inc., 6.50%, 11/15/2008	BBB		9,000,000		9,371,493
FINANCIALS–13.3%
Banks–3.3%
Bank of New York, Inc., 6.50%, 12/01/2003	A		2,610,000		2,748,852
Firststar Bank:
6.25%, 12/01/2002	A		2,450,000		2,536,590
7.125%, 12/01/2009	A		5,925,000		6,340,343
National City Corp.:
6.875%, 05/15/2019	A-		7,795,000		7,539,729
7.20%, 05/15/2005	A-		900,000		970,647
Norwest Financial, Inc., 5.375%, 09/30/2003	Aa2		950,000		977,256
PNC Funding Corp.:
6.125%, 09/01/2003	BBB+		5,475,000		5,724,501
6.125%, 02/15/2009	BBB+		10,225,000		10,342,680
SunTrust Banks, Inc.:
6.125%, 02/15/2004	A		340,000		355,860
6.375%, 04/01/2011	A+		6,500,000		6,648,505
Washington Mutual, Inc., 7.50%, 08/15/2006	BBB+		10,700,000		11,810,339
					55,995,302
Diversified Financials–6.4%
Alliance Capital Management LP, 5.625%, 08/15/2006	A+		11,250,000		11,508,874
Associates Corp.:
5.75%, 10/15/2003	AA-		15,180,000		15,772,058
Caterpillar Financial Services, 6.09%, 03/01/2004	A+		14,000,000		14,645,162
GMAC:
5.85%, 01/14/2009	A		4,515,000		4,302,519
6.38%, 01/30/2004	A		6,000,000		6,223,506
6.875%, 09/15/2011	A		6,500,000		6,385,223

44

EVERGREEN
Core Bond Fund
(formerly, Evergreen Select Core Bond Fund)
Schedule of Investments (continued)

September 30, 2001

	Credit Rating^	Principal Amount		Value
CORPORATE BONDS–continued
FINANCIALS–continued
Diversified Financials–continued
Household Finance Corp.:
5.875%, 09/25/2004	A	$	225,000	$	234,045
6.50%, 11/15/2008	A		11,050,000		11,398,926
7.20%, 07/15/2006	A		5,275,000		5,699,421
International Lease Finance Corp.:
5.35%, 05/03/2004	AA-		13,800,000		14,310,227
5.95%, 06/06/2005	AA-		6,150,000		6,437,027
Merrill Lynch & Co., 6.15%, 01/26/2006	AA-		4,625,000		4,818,741
Morgan Stanley Group, Inc., 6.10%, 04/15/2006	AA-		6,700,000		6,933,274
Sears Roebuck Acceptance Corp., 6.99%, 09/30/2002	A-		750,000		778,752
					109,447,755
Insurance–1.1%
American General Finance Corp.:
5.875%, 07/14/2006	A+		8,000,000		8,297,576
6.86%, 11/22/2002	A+		700,000		729,810
7.45%, 01/15/2005	A+		8,700,000		9,504,437
					18,531,823
Real Estate–2.5%
AvalonBay Communities, Inc., 6.625%, 01/15/2005 REIT	BBB+		6,485,000		6,800,158
Duke Realty LP, 7.05%, 03/01/2006 REIT	Baa1		3,470,000		3,678,741
EOP Operating LP, 6.80%, 01/15/2009	BBB+		10,185,000		10,419,785
ERP Operating LP:
6.55%, 11/15/2001 REIT	BBB+		1,325,000		1,329,779
6.63%, 04/13/2005 REIT	BBB+		20,450,000		21,251,722
					43,480,185
INDUSTRIALS–1.5%
Air Freight & Couriers–0.3%
United Parcel Services, Inc., 8.375%, 04/01/2020	AAA		4,470,000		5,346,933
Road & Rail–1.2%
Burlington Northern Santa Fe Corp.:
6.75%, 03/15/2029	BBB+		8,470,000		8,040,181
7.125%, 12/15/2010	BBB+		6,800,000		7,205,090
8.625%, 11/01/2004	BBB+		5,130,000		5,626,738
					20,872,009
MATERIALS–2.2%
Chemicals–0.7%
Dow Chemical Co., 6.125%, 02/01/2011	A		12,700,000		12,829,337
Metals & Mining–1.0%
Alcoa, Inc., 6.50%, 06/01/2011	A+		16,500,000		17,254,875

45

EVERGREEN
Core Bond Fund
(formerly, Evergreen Select Core Bond Fund)
Schedule of Investments (continued)

September 30, 2001

	Credit Rating^	Principal Amount		Value
CORPORATE BONDS–continued
MATERIALS–continued
Paper & Forest Products–0.5%
International Paper Co., 6.50%, 11/15/2007	BBB	$	325,000	$	331,891
Weyerhaeuser Co., 6.00%, 08/01/2006	A-		7,500,000		7,665,668
					7,997,559
TELECOMMUNICATION SERVICES–4.4%
Diversified Telecommunication Services–4.4%
AT&T Corp., 6.50%, 03/15/2029	A		7,740,000		6,773,615
Bellsouth Telecommunications, Inc., 6.375%, 06/01/2028	A+		5,445,000		4,929,821
MCI Communications Corp., 6.50%, 04/15/2010	BBB+		4,800,000		4,620,653
Navistar International Corp., 9.375%, 06/01/2006	BBB-		12,000,000		11,640,000
New Jersey Bell Telephone Co., 7.85%, 11/15/2029	A+		8,000,000		8,637,688
Pacific Bell, 6.625%, 11/01/2009	AA-		600,000		623,703
Sprint Capital Corp.:
5.875%, 05/01/2004	BBB+		10,175,000		10,414,845
6.125%, 11/15/2008	BBB+		10,000,000		9,744,560
6.875%, 11/15/2028	BBB+		8,725,000		7,876,031
WorldCom, Inc., 6.95%, 08/15/2028	BBB+		10,825,000		9,478,868
					74,739,784
UTILITIES–0.8%
Gas Utilities–0.8%
Consolidated Natural Gas Co., 6.85%, 04/15/2011	BBB+		6,135,000		6,345,369
Enron Corp., 7.375%, 05/15/2019	BBB-		7,840,000		7,677,563
					14,022,932
Total Corporate Bonds					500,515,194
MORTGAGE-BACKED SECURITIES–38.5%
FHLMC:
6.00%, 05/01/2031-08/01/2031	AAA		26,238,793		26,210,336
7.00%, 02/01/2015	AAA		1,447,232		1,514,258
7.50%, 04/01/2023-08/01/2031	AAA		22,909,587		23,845,253
6.00%, TBA #	AAA		113,360,000		113,146,883
FNMA:
5.78%, 01/01/2013	AAA		6,900,000		7,150,470
5.81%, 01/01/2009 @	AAA		10,193,131		10,438,785
6.00%, 05/01/2016-05/01/2029 ##	AAA		64,395,626		64,869,404
6.08%, 04/01/2005	AAA		4,682,683		4,903,731
6.125%, 05/01/2009	AAA		4,387,638		4,578,924
6.13%, 04/01/2009	AAA		38,512		40,226
6.14%, 04/01/2009	AAA		3,544,434		3,701,871
6.15%, 12/01/2008	AAA		5,096,173		5,277,540
6.18%, 12/01/2008	AAA		4,008,032		4,157,835
6.29%, 05/01/2011 @	AAA		9,970,902		10,331,849
6.31%, 03/01/2008	AAA		1,301,934		1,374,746

46

EVERGREEN
Core Bond Fund
(formerly, Evergreen Select Core Bond Fund)
Schedule of Investments (continued)

September 30, 2001

	Credit Rating^	Principal Amount		Value
MORTGAGE-BACKED SECURITIES–continued
FNMA–continued:
6.32%, 01/01/2006-04/01/2009	AAA	$	13,333,167	$	14,023,549
6.37%, 04/01/2009	AAA		180,876		189,211
6.61%, 02/01/2007	AAA		6,452,851		6,893,507
6.70%, 11/01/2007	AAA		528,324		567,408
6.77%, 08/01/2004	AAA		172,599		182,396
6.81%, 12/01/2006	AAA		52,343		56,290
6.96%, 12/01/2010	AAA		54,651		59,479
7.02%, 12/01/2010	AAA		79,535		86,769
7.13%, 11/01/2006	AAA		4,278,820		4,656,819
7.17%, 05/01/2007	AAA		12,718,361		13,877,217
7.24%, 11/01/2006	AAA		4,521,638		4,941,402
7.28%, 10/01/2003	AAA		139,186		146,024
7.36%, 11/01/2006 @	AAA		5,130,000		5,602,986
7.375%, 08/01/2006	AAA		59,256		64,946
7.50%, 08/01/2015-06/01/2031 ##	AAA		103,217,825		107,775,479
7.54%, 11/01/2006	AAA		6,822,249		7,470,856
7.74%, 06/01/2007	AAA		5,185,871		5,796,377
7.79%, 06/01/2010	AAA		9,520,129		10,860,804
8.00%, 11/01/2030	AAA		8,707,453		9,194,667
8.50%, 01/01/2012	AAA		15,463		16,517
8.66%, 01/01/2005	AAA		566,154		628,044
5.50%, TBA #	AAA		63,975,000		64,094,633
6.00%, TBA #	AAA		61,480,000		62,000,050
7.50%, TBA #	AAA		27,620,000		28,801,594
GNMA:
7.00%, 09/15/2012	AAA		86,788		91,256
7.75%, 07/15/2020-08/15/2021	AAA		6,538,979		6,910,128
8.00%, 07/15/2016-10/15/2030	AAA		22,595,131		23,749,554
Total Mortgage-Backed Securities					660,280,073
U.S. TREASURY OBLIGATIONS–9.9%
U.S. Treasury Bonds, 6.25%, 08/15/2023 ##	AAA		97,515,000		107,007,500
U.S. Treasury Notes:
3.375%, 01/15/2007	AAA		17,033,880		17,528,936
5.875%, 11/15/2004	AAA		12,720,000		13,644,197
6.00%, 08/15/2009	AAA		7,075,000		7,782,783
7.00%, 07/15/2006	AAA		22,062,000		24,998,143
Total U.S. Treasury Obligations					170,961,559

47

EVERGREEN
Core Bond Fund
(formerly, Evergreen Select Core Bond Fund)
Schedule of Investments (continued)

September 30, 2001

	Shares	Value
MUTUAL FUND SHARES–2.5%
Aberdeen Asia Pacific Income Fund	410,200	$	1,628,494
Aberdeen Commonwealth Income Fund	136,700		1,223,465
Blackrock Investment Quality Term Trust	144,900		1,327,284
Blackrock North American Government Income Trust	957,100		9,800,704
Blackrock Strategic Term Trust	449,000		4,350,810
Hyperion 2002 Term Trust	907,100		8,653,734
Hyperion 2005 Investment Grade Opportunity Term Trust	145,600		1,389,024
John Hancock Income Securities Trust	126,700		1,849,820
MFS Government Markets Income Trust	1,070,200		7,084,724
TCW / DW Term Trust 2003	512,400		5,405,820
Total Mutual Fund Shares			42,713,879
SHORT-TERM INVESTMENTS–24.2%
MUTUAL FUND SHARES–24.2%
Evergreen Institutional Money Market Fund ø	415,150,184		415,150,184
Total Investments–(cost $1,915,004,910)–114.9%			1,971,971,502
Other Assets and Liabilities–(14.9%)			(255,994,863	)
Net Assets–100.0%		$	1,715,976,639

See Combined Notes to Schedules of Investments.

48

EVERGREEN
Fixed Income Fund
(formerly, Evergreen Select Fixed Income Fund)
Schedule of Investments

September 30, 2001

	Credit Rating^	Principal Amount		Value
ASSET-BACKED SECURITIES–3.6%
Capco America Securitization Corp., 5.86%, 12/15/2007	AAA	$	5,892,263	$	6,114,355
Case Equipment Loan Trust, Ser. 1998-A, Class A4, 5.86%,
02/15/2005	AAA		54,837		54,958
Continental Airlines, Inc. Pass Through Trust, Ser. 2000-2,
Class A2, 7.49%, 10/02/2010	AA		2,400,000		2,358,977
Distribution Financial Services Trust, Ser. 1999-3, Class A4,
6.65%, 11/03/2015	AAA		5,000,000		5,174,259
Empire Funding Home Loan Owner Trust, Ser. 1998-1, Class A4,
6.26%, 12/25/2012	AAA		1,948,426		2,013,740
Metlife Capital Equipment Loan Trust, Ser. 1997-A, Class A,
6.85%, 05/20/2008	AAA		1,063,925		1,103,639
Prudential Securities Secured Financing Corp., Ser. 1994-4,
Class A1, 8.12%, 02/15/2025	AAA		1,600,608		1,708,097
The Money Store Home Equity Trust, Ser. 1992-B, Class A,
6.90%, 07/15/2007	AAA		305,916		305,714
Total Asset-Backed Securities					18,833,739
COLLATERALIZED MORTGAGE OBLIGATIONS–7.4%
Commerce 2000, Ser. C1, Class A2, 7.42%, 04/15/2010	AAA		4,895,000		5,400,202
Commerce 2000 C-1, 7.21%, 09/15/2008	AAA		6,820,186		7,376,685
FHLMC:
Ser. 1519, Class F, 6.75%, 03/15/2007	AAA		506,944		511,742
Ser. 1634, Class PH, 6.00%, 11/15/2022	AAA		4,600,000		4,755,963
Ser. 1675, Class J, 6.50%, 06/15/2023	AAA		6,250,000		6,485,156
Ser. 1935, Class FL, 4.58%, 02/15/2027	AAA		418,285		421,940
FNMA, Ser. 1998-W8, Class A4, 6.02%, 09/25/2028	AAA		5,750,000		5,891,939
Lehman Brothers Comml. Conduit Mtge. Trust, Ser. 1999-C1,
Class A1, 6.41%, 08/15/2007	AAA		4,959,423		5,227,425
Morgan Stanley Capital I, Inc., Ser. 1998-XL2, 6.17%,
10/03/2008	AAA		2,700,000		2,799,045
Total Collateralized Mortgage Obligations					38,870,097
CORPORATE BONDS–45.1%
CONSUMER DISCRETIONARY–6.4%
Automobiles–1.0%
General Motors Corp., 7.20%, 01/15/2011	A		5,000,000		5,083,560
Media–0.8%
AOL Time Warner, Inc.:
6.125%, 04/15/2006	BBB+		2,500,000		2,583,472
8.11%, 08/15/2006	BBB+		1,690,000		1,883,091
					4,466,563

49

EVERGREEN
Fixed Income Fund
(formerly, Evergreen Select Fixed Income Fund)
Schedule of Investments (continued)

September 30, 2001

	Credit Rating^		Principal Amount		Value
CORPORATE BONDS–continued
CONSUMER DISCRETIONARY–continued
Multi-line Retail–4.0%
May Department Stores Co., 7.15%, 08/15/2004	A+		$	3,630,000	$	3,903,669
Sears Roebuck Acceptance Corp., 7.00%, 02/01/2011	A-			4,100,000		4,033,523
Target Corp., 7.50%, 02/15/2005	A+			8,200,000		8,982,756
Wal-Mart Stores, Inc., 6.875%, 08/10/2009	AA			4,000,000		4,337,844
						21,257,792
Textiles & Apparel–0.6%
Nike, Inc., 5.50%, 08/15/2006	A			3,000,000		3,045,057
CONSUMER STAPLES–2.5%
Beverages–2.0%
Coca Cola Co., 5.75%, 04/30/2009	A			6,500,000		6,555,829
Pepsi Bottling Group, Inc., 5.625%, 02/17/2009 144A	A			3,975,000		4,013,140
						10,568,969
Food & Drug Retailing–0.5%
Safeway, Inc., 7.00%, 09/15/2002	BBB			2,425,000		2,487,938
ENERGY–2.0%
Energy Equipment & Services–1.4%
Nisource, Inc., 7.625%, 11/15/2005	BBB			6,850,000		7,464,322
Oil & Gas–0.6%
Amerada Hess Corp., 5.90%, 08/15/2006	BBB			3,275,000		3,340,709
FINANCIALS–23.4%
Banks–5.9%
Bank of America Corp., 9.125%, 10/15/2001	A			1,020,000		1,022,109
Bell Atlantic Finance Services, Inc., 7.60%, 03/15/2007	A+			5,000,000		5,504,665
PNC Funding Corp.:
5.75%, 08/01/2006	A-			2,000,000		2,051,476
6.125%, 02/15/2009	BBB+			3,400,000		3,439,131
SunTrust Banks, Inc., 6.375%, 04/01/2011	A+			4,000,000		4,091,388
Washington Mutual, Inc., 6.875%, 06/15/2011	BBB+			4,250,000		4,466,924
Wells Fargo & Co., 6.625%, 07/15/2004	A+	10,000,000				10,701,130
						31,276,823
Diversified Financials–14.4%
Alliance Capital Management LP, 5.625%, 08/15/2006	A+			5,250,000		5,370,808
American Express Co., 5.50%, 09/12/2006	A1			4,000,000		4,020,228
Boeing Capital Corp., 6.10%, 03/01/2011	AA-			5,000,000		4,899,310
Caterpillar Financial Services, 5.33%, 08/30/2004	A+			5,000,000		5,144,575
Duke Capital Corp., 7.25%, 10/01/2004	A			3,900,000		4,191,248
Ford Motor Credit Co., 7.375%, 10/28/2009	A			5,000,000		5,108,495
General Electric Capital Corp., 6.80%, 11/01/2005	AAA			4,000,000		4,322,276

50

EVERGREEN
Fixed Income Fund
(formerly, Evergreen Select Fixed Income Fund)
Schedule of Investments (continued)

September 30, 2001

	Credit Rating^	Principal Amount		Value
CORPORATE BONDS–continued
FINANCIALS–continued
Diversified Financials–continued
GMAC:
6.75%, 12/10/2002	A	$	5,000,000	$	5,182,295
6.875%, 09/15/2011	A		2,200,000		2,161,152
Golden West Financial Corp., 5.50%, 08/08/2006	A		2,500,000		2,514,373
Household Finance Corp., 6.40%, 06/17/2008	A		4,000,000		4,106,944
International Lease Finance Corp.:
5.35%, 05/03/2004	AA-		3,000,000		3,110,037
5.95%, 06/06/2005	AA-		5,000,000		5,233,355
John Deere Capital Corp., 5.52%, 04/30/2004	A		5,000,000		5,172,260
Legg Mason, Inc., 6.75%, 07/02/2008	BBB		3,600,000		3,754,508
LG&E Capital Corp., 5.75%, 11/01/2001 144A	BBB		5,000,000		5,006,340
Merrill Lynch & Co., Inc., 6.00%, 02/12/2003	AA-		2,350,000		2,435,911
Morgan Stanley Group, Inc., 6.10%, 04/15/2006	AA-		4,000,000		4,139,268
					75,873,383
Insurance–2.3%
American General Finance Corp., 6.10%, 05/22/2006	A+		6,500,000		6,789,101
Metropolitan Life Insurance Co., 7.00%, 11/01/2005 144A	A+		5,000,000		5,318,310
					12,107,411
Real Estate–0.8%
EOP Operating LP, 7.00%, 07/15/2011	BBB+		3,800,000		3,893,742
HEALTH CARE–0.4%
Pharmaceuticals–0.4%
American Home Products Corp., 6.25%, 03/15/2006	A		2,000,000		2,088,236
INDUSTRIALS–3.7%
Aerospace & Defense–1.1%
McDonnell Douglas Corp., 6.875%, 11/01/2006	AA-		5,555,000		5,888,250
Chemicals–0.8%
Dow Chemical Co., 6.125%, 02/01/2011	A		4,100,000		4,141,755
Machinery–0.6%
Ingersoll Rand Co., 6.25%, 05/15/2006	A-		3,000,000		3,103,419
Road & Rail–1.2%
Union Pacific Corp., 9.625%, 12/15/2002	BBB-		6,000,000		6,409,056
INFORMATION TECHNOLOGY–2.6%
Communications Equipment–1.2%
SBC Communications, Inc., 6.25%, 03/15/2011	AA-		6,000,000		6,148,332
Computers & Peripherals–0.6%
International Business Machines, Inc., 5.25%, 12/01/2003	A+		3,000,000		3,100,527

51

EVERGREEN
Fixed Income Fund
(formerly, Evergreen Select Fixed Income Fund)
Schedule of Investments (continued)

September 30, 2001

	Credit Rating^	Principal Amount		Value
CORPORATE BONDS–continued
INFORMATION TECHNOLOGY–continued
IT Consulting & Services–0.8%
Verizon Global Funding Corp., 6.75%, 12/01/2005	A+	$	4,000,000	$	4,263,756
MATERIALS–0.8%
Metals & Mining–0.8%
Alcoa, Inc., 5.875%, 06/01/2006	A+		4,000,000		4,157,620
TELECOMMUNICATION SERVICES–3.3%
Diversified Telecommunication Services–2.5%
Navistar International Corp., 9.375%, 06/01/2006	BBB-		4,000,000		3,880,000
Sprint Capital Corp., 7.625%, 01/30/2011	BBB+		6,000,000		6,357,270
Worldcom, Inc., 6.50%, 05/15/2004	BBB+		3,000,000		3,106,797
					13,344,067
Wireless Telecommunications Services–0.8%
Vodafone Airtouch Plc, 7.625%, 02/15/2005	A		4,000,000		4,327,340
Total Corporate Bonds					237,838,627
MORTGAGE-BACKED SECURITIES–30.0%
FHLMC:
6.50%, 07/01/2004	AAA		560,544		578,181
7.50%, 10/01/2030-01/01/2031	AAA		8,511,658		8,860,352
6.00%, TBA #	AAA		10,350,000		10,330,542
7.50%, TBA #	AAA		4,355,000		4,530,506
FNMA:
6.00%, 11/01/2008-05/01/2029 ##	AAA		44,485,953		45,137,580
6.15%, 04/01/2011	AAA		2,788,611		2,884,504
6.19%, 06/01/2017	AAA		52,741		53,290
6.26%, 04/01/2011 @	AAA		3,985,144		4,174,836
6.625%, 09/15/2009	AAA		3,400,000		3,751,172
6.82%, 12/01/2007	AAA		6,435,082		6,942,505
6.91%, 07/01/2009	AAA		5,946,054		6,460,474
7.17%, 05/01/2007	AAA		4,704,554		5,133,218
7.21%, 06/01/2006	AAA		5,125,313		5,582,593
7.44%, 12/01/2006	AAA		3,355,905		3,662,072
7.50%, 09/01/2015-02/01/2031	AAA		17,635,007		18,436,652
11.00%, 02/01/2025	AAA		2,683,761		3,037,198
5.50%, TBA #	AAA		2,835,000		2,840,301
7.50%, TBA #	AAA		20,710,000		21,531,773
GNMA:
8.05%, 06/15/2019-10/15/2020	AAA		4,038,055		4,311,118
Total Mortgage-Backed Securities					158,238,867

52

EVERGREEN
Fixed Income Fund
(formerly, Evergreen Select Fixed Income Fund)
Schedule of Investments (continued)

September 30, 2001

	Credit Rating ^	Principal Amount		Value
U.S. TREASURY OBLIGATIONS–10.9%
U.S. Treasury Notes:
3.375%, 01/15/2007	AAA	$	8,292,810	$	8,533,824
5.875%, 11/15/2004	AAA		23,875,000		25,609,686
6.00%, 08/15/2009	AAA		13,790,000		15,169,551
7.00%, 07/15/2006	AAA		7,370,000		8,350,844
Total U.S. Treasury Obligations					57,663,905
YANKEE OBLIGATIONS-GOVERNMENT–2.4%
Canada:
4.625%, 10/03/2006	AA-		2,500,000		2,503,870
5.50%, 10/01/2008	AA		10,000,000		10,307,510
Total Yankee Obligations-Government					12,811,380
		Shares		Value
SHORT-TERM INVESTMENTS–6.3%
MUTUAL FUND SHARES–6.3%
Evergreen Institutional Money Market Fund ø			33,371,237		33,371,237
Total Investments–(cost $541,609,350)–105.7%					557,627,852
Other Assets and Liabilities–(5.7%)					(30,235,550	)
Net Assets–100.0%				$	527,392,302

See Combined Notes to Schedules of Investments.

53

EVERGREENFixed Income Fund II
(formerly, Evergreen Select Fixed Income Fund II)
Schedule of Investments

September 30, 2001

	Credit	Principal Amount		Value
	Rating^
ASSET-BACKED SECURITIES–2.3%
Advanta Home Equity Loan Trust, Ser. 1993-2, Class A2, 6.15%,
10/25/2009	AAA	$	273,507	$	273,285
GE Capital Mtge. Funding Corp., Ser. 1999-HE3, Class A3,
7.11%, 07/25/2014	Aaa		600,000		615,440
Union Acceptance Corp., Ser. 1998-D, Class A3, 5.75%,
06/09/2003	AAA		129,034		129,349
Total Asset-Backed Securities					1,018,074
COLLATERALIZED MORTGAGE OBLIGATIONS–12.3%
Commerce 2000, Ser. C1, Class A2, 7.42%, 04/15/2010	AAA		500,000		551,604
FHLMC:
Ser. 2132, Class PD, 6.00%, 11/15/2027	AAA		600,000		605,001
Ser. 2362, Class PC, 6.50%, 04/15/2017 @	AAA		500,000		522,800
FNMA:
Ser. 1999-60, Class CG, 6.00%, 10/18/2028	AAA		900,000		904,657
Ser. 1999-8, Class QD, 6.00%, 03/25/2014	AAA		500,000		512,218
GMAC Comml. Mtge. Securities, Inc., Ser. 1998-C2, Class A1,
6.15%, 11/15/2007	AAA		870,359		908,302
Lehman Brothers Comml. Conduit Mtge. Trust, Ser. 1999-C2,
Class A1, 7.11%, 07/15/2008	Aaa		941,767		1,013,379
Paine Webber Mtge. Acceptance Corp., Ser. 1999-C1, Class A2,
6.82%, 04/15/2009	AAA		500,000		535,703
Total Collateralized Mortgage Obligations					5,553,664
CORPORATE BONDS–31.4%
CONSUMER DISCRETIONARY–5.0%
Automobiles–2.0%
Ford Motor Co., 6.375%, 02/01/2029	A		500,000		411,054
General Motors Corp., 7.20%, 01/15/2011	A		500,000		508,356
					919,410
Media–0.7%
Comcast Cable Communications Corp., 6.20%, 11/15/2008	BBB		300,000		299,205
Multi-line Retail–2.3%
Sears Roebuck Acceptance Corp., 7.00%, 02/01/2011	A-		500,000		491,893
Wal-Mart Stores, Inc., 6.875%, 08/10/2009	AA		500,000		542,230
					1,034,123
CONSUMER STAPLES–3.9%
Beverages–2.7%
Coca Cola Enterprises, Inc., 6.95%, 11/15/2026	A		500,000		501,407
Pepsi Bottling Group, Inc., 7.00%, 03/01/2029	A-		700,000		724,813
					1,226,220

54

EVERGREENFixed Income Fund II
(formerly, Evergreen Select Fixed Income Fund II)
Schedule of Investments (continued)

September 30, 2001

	Credit Rating^	Principal Amount		Value
CORPORATE BONDS–continued
CONSUMER STAPLES–continued
Food & Drug Retailing–1.2%
Safeway, Inc., 6.50%, 11/15/2008	BBB	$	500,000	$	520,639
FINANCIALS–16.2%
Banks–0.9%
Washington Mutual, Inc., 6.875%, 06/15/2011	BBB+		400,000		420,416
Diversified Financials–10.3%
Alliance Capital Management LP, 5.625%, 08/15/2006	A+		300,000		306,903
Boeing Capital Corp., 6.10%, 03/01/2011	AA-		500,000		489,931
Ford Motor Credit Co., 7.375%, 10/28/2009	A		500,000		510,850
Household Finance Corp., 6.75%, 05/15/2011	A		500,000		514,474
International Lease Finance Corp.:
5.35%, 05/03/2004	AA-		500,000		518,339
5.95%, 06/06/2005	AA-		250,000		261,668
John Deere Capital Corp., 5.52%, 04/30/2004	A		500,000		517,226
Merrill Lynch & Co., 6.15%, 01/26/2006	AA-		500,000		520,945
Norwest Financial, Inc., 7.60%, 05/03/2005	A+		400,000		438,006
PNC Funding Corp., 7.50%, 11/01/2009	BBB+		500,000		543,707
					4,622,049
Insurance–1.1%
American General Finance Corp., 5.875%, 07/14/2006	A+		500,000		518,599
Real Estate–3.9%
Duke Realty LP, 7.05%, 03/01/2006 REIT	Baa1		500,000		530,078
EOP Operating LP, 6.80%, 01/15/2009	BBB+		1,200,000		1,227,662
					1,757,740
HEALTH CARE–1.2%
Pharmaceuticals–1.2%
American Home Products Corp., 6.25%, 03/15/2006	A		500,000		522,059
INDUSTRIALS–0.7%
Machinery–0.7%
Ingersoll Rand Co., 6.25%, 05/15/2006	A-		325,000		336,204
INFORMATION TECHNOLOGY–2.3%
Communications Equipment–2.3%
SBC Communications, Inc.:
5.75%, 05/02/2006	AA-		500,000		519,184
6.25%, 03/15/2011	AA-		500,000		512,361
					1,031,545
MATERIALS–1.0%
Metals & Mining–1.0%
Alcoa, Inc., 6.50%, 06/01/2011	A+		450,000		470,587

55

EVERGREENFixed Income Fund II
(formerly, Evergreen Select Fixed Income Fund II)
Schedule of Investments (continued)

September 30, 2001

	Credit Rating^	Principal Amount		Value
CORPORATE BONDS–continued
TELECOMMUNICATION SERVICES–1.1%
Diversified Telecommunication Services–1.1%
Sprint Capital Corp., 6.875%, 11/15/2028	BBB+	$	300,000	$	270,809
WorldCom, Inc., 6.95%, 08/15/2028	BBB+		250,000		218,911
					489,720
Total Corporate Bonds					14,168,516
MORTGAGE-BACKED SECURITIES–39.2%
FHLMC:
6.00%, 06/01/2031 ##	AAA		2,528,570		2,525,828
6.00%, TBA #	AAA		1,910,000		1,906,409
7.50%, TBA #	AAA		470,000		488,800
FNMA:
6.00%, 05/01/2016-05/01/2029	AAA		1,822,071		1,836,665
6.36%, 03/01/2011	AAA		298,780		309,054
6.41%, 06/01/2011 @	AAA		598,690		628,821
6.42%, 03/01/2011	AAA		497,860		517,168
7.10%, 06/01/2004	AAA		671,530		712,559
7.13%, 12/01/2010	AAA		447,377		484,799
7.29%, 01/01/2011	AAA		696,298		761,268
7.50%, 09/01/2015-08/01/2031	AAA		4,912,555		5,118,524
7.53%, 05/01/2007	AAA		405,594		449,474
5.50%, TBA #	AAA		735,000		736,375
6.00%, TBA #	AAA		825,000		838,662
7.50%, TBA #	AAA		315,000		327,499
Total Mortgage-Backed Securities					17,641,905
U.S. TREASURY OBLIGATIONS–8.2%
U.S. Treasury Bonds, 6.25%, 08/15/2023 ##	AAA		1,825,000		2,002,653
U.S. Treasury Notes:
5.875%, 11/15/2004	AAA		265,000		284,254
7.00%, 07/15/2006	AAA		1,230,000		1,393,696
Total U.S. Treasury Obligations					3,680,603
YANKEE OBLIGATIONS-CORPORATE–1.2%
CONSUMER DISCRETIONARY–1.2%
Wireless Telecommunications Services–1.2%
Vodafone Group Plc, 7.75%, 02/15/2010	A		500,000		547,995

56

EVERGREENFixed Income Fund II
(formerly, Evergreen Select Fixed Income Fund II)
Schedule of Investments (continued)

September 30, 2001

	Shares	Value
SHORT-TERM INVESTMENTS–11.7%
MUTUAL FUND SHARES–11.7%
Evergreen Institutional Money Market Fund ø	5,287,199	$	5,287,199
Total Investments–(cost $46,804,545)–106.3%			47,897,956
Other Assets and Liabilities–(6.3%)			(2,837,210	)
Net Assets–100.0%		$	45,060,746

See Combined Notes to Schedules of Investments.

57

EVERGREEN
Select High Yield Bond Fund
Schedule of Investments

September 30, 2001

	Credit Rating^	Principal Amount		Value
CORPORATE BONDS–78.8%
CONSUMER DISCRETIONARY–32.8%
Auto Components–3.8%
Collins & Aikman Products Co., 11.50%, 04/15/2006	B	$	1,650,000	$	1,476,750
Delco Remy International, Inc., 11.00%, 05/01/2009	B		1,650,000		1,641,750
Dura Operating Corp., 9.00%, 05/01/2009	B		1,500,000		1,252,500
Lear Corp., Ser. B, 8.11%, 05/15/2009	BB+		1,500,000		1,471,101
					5,842,101
Hotels, Restaurants & Leisure–13.8%
Anchor Gaming, 9.875%, 10/15/2008	B		1,500,000		1,537,500
Argosy Gaming Co., 10.75%, 06/01/2009	B+		1,650,000		1,765,500
Aztar Corp., 8.875%, 05/15/2007	B+		1,650,000		1,600,500
Coast Hotels & Casinos, Inc., 9.50%, 04/01/2009	B		1,500,000		1,447,500
Hollywood Casino Corp.:
11.25%, 05/01/2007	B		1,500,000		1,522,500
13.00%, 08/01/2006	B-		1,500,000		1,290,000
Horseshoe Gaming Holdings, Ser. B, 8.625%, 05/15/2009	B+		1,500,000		1,477,500
International Game Technology, 8.375%, 05/15/2009	BB+		750,000		759,375
Isle of Capri Casinos, Inc., 8.75%, 04/15/2009	B		1,650,000		1,476,750
Mandalay Resort Group, Ser. B, 10.25%, 08/01/2007	BB-		1,650,000		1,526,250
MGM Mirage, Inc., 8.50%, 09/15/2010	BBB-		845,000		816,398
Mohegan Tribal Gaming Authority, 8.75%, 01/01/2009	BB-		1,500,000		1,522,500
Prime Hospitality Corp., Ser. B, 9.75%, 04/01/2007	B+		1,500,000		1,492,500
Station Casinos, Inc., 9.875%, 07/01/2010	B+		1,500,000		1,365,000
Tricon Global Restaurants, Inc., 8.875%, 04/15/2011	BB		1,500,000		1,537,500
					21,137,273
Household Durables–5.6%
Del Webb Corp., 9.375%, 05/01/2009	BB+		1,500,000		1,507,500
K. Hovnanian Enterprises, Inc., 10.50%, 10/01/2007	BB-		1,640,000		1,664,600
Lennar Corp., 7.625%, 03/01/2009	BB+		1,500,000		1,417,500
MDC Holdings, Inc., 8.375%, 02/01/2008	BB		1,210,000		1,155,550
Meritage Corp., 9.75%, 06/01/2011	B		1,500,000		1,395,000
Sealy Mattress Co.:
9.875%, 12/15/2007 144A	B-		500,000		467,500
Ser. B, 9.875%, 12/15/2007	B-		1,000,000		935,000
					8,542,650
Media–7.7%
American Media Operations, Inc., 10.25%, 05/01/2009	B-		1,000,000		985,000
Chancellor Media Corp., 8.00%, 11/01/2008	BBB-		1,500,000		1,563,750
Charter Communications Holdings, LLC, 8.625%, 04/01/2009	B+		1,650,000		1,480,875
CSC Holdings, Inc., 9.875%, 02/15/2013	BB-		1,000,000		1,080,000
Echostar DBS Corp., 9.375%, 02/01/2009	B+		1,650,000		1,621,125
Emmis Communications Corp., Ser. B, 8.125%, 03/15/2009	B-		1,500,000		1,350,000
Hollinger International Publishing, Inc., 9.25%, 02/01/2006	B+		1,000,000		936,250

58

EVERGREEN
Select High Yield Bond Fund
Schedule of Investments (continued)

September 30, 2001

	Credit Rating^	Principal Amount		Value
CORPORATE BONDS–continued
CONSUMER DISCRETIONARY–continued
Media–continued
LIN Televison Corp., 8.375%, 03/01/2008	B-	$	1,500,000	$	1,342,500
Young Broadcasting, Inc., 10.00%, 03/01/2011 144A	B		1,650,000		1,320,000
					11,679,500
Specialty Retail–1.9%
Michaels Stores, Inc., 9.25%, 07/01/2009 144A	BB		1,500,000		1,507,500
Steinway Musical Instruments, Inc., 8.75%, 04/15/2011 144A	BB-		1,500,000		1,380,000
					2,887,500
CONSUMER STAPLES–6.4%
Beverages–0.7%
Constellation Brands, Inc., 8.625%, 08/01/2006	BB		1,000,000		1,011,250
Food & Drug Retailing–4.2%
AFC Enterprises, Inc., 10.25%, 05/15/2007	B+		1,000,000		1,045,000
Jack In The Box, Inc., 8.375%, 04/15/2008	BB-		1,500,000		1,492,500
Marsh Supermarket, Inc., Ser. B, 8.875%, 08/01/2007	B+		1,000,000		965,000
Pantry, Inc., 10.25%, 10/15/2007	B		1,500,000		1,462,500
Winn Dixie Stores, Inc., 8.875%, 04/01/2008	BB+		1,500,000		1,440,000
					6,405,000
Food Products–1.0%
Michael Foods, Inc., Ser. B, 11.75%, 04/01/2011	B-		1,500,000		1,567,500
Personal Products–0.5%
Armkel, LLC, 9.50%, 08/15/2009 144A	B-		750,000		763,125
ENERGY–8.0%
Energy Equipment & Services–3.2%
Dresser, Inc., 9.375%, 04/15/2011 144A	B		1,500,000		1,500,000
Grant Prideco, Inc., 9.625%, 12/01/2007	BB		820,000		770,800
Lone Star Technologies, Inc., 9.00%, 06/01/2011 144A	B+		1,500,000		1,177,500
Parker Drilling Co., Ser. D, 9.75%, 11/15/2006	B+		1,650,000		1,518,000
					4,966,300
Oil & Gas–4.8%
Chesapeake Energy Corp., 8.125%, 04/01/2011	B+		1,650,000		1,559,250
HS Resources, Inc., 9.25%, 11/15/2006	B+		1,250,000		1,309,375
Nuevo Energy Co., Ser. B, 9.50%, 06/01/2008	B+		1,650,000		1,559,250
Pioneer Natural Resources Co., 9.625%, 04/01/2010	BB+		1,100,000		1,187,442
XTO Energy, Inc., Ser. B, 9.25%, 04/01/2007	B+		1,650,000		1,707,750
					7,323,067

59

EVERGREEN
Select High Yield Bond Fund
Schedule of Investments (continued)

September 30, 2001

	Credit Rating^	Principal Amount		Value
CORPORATE BONDS–continued
FINANCIALS–1.8%
Real Estate–1.8%
Choctaw Resort Development Enterprise, 9.25%,
04/01/2009 144A	BB-	$	1,500,000	$	1,492,500
Meristar Hospitality Corp., 9.00%, 01/15/2008 REIT 144A	BB-		1,500,000		1,222,500
					2,715,000
HEALTH CARE–7.4%
Health Care Providers & Services–6.7%
Bergen Brunswig Corp., 7.375%, 01/15/2003	BB-		1,025,000		1,043,582
Davita, Inc., 9.25%, 04/15/2011	B-		1,500,000		1,552,500
Express Scripts, Inc., 9.625%, 06/15/2009	BB+		1,650,000		1,806,750
Magellan Health Services, Inc., 9.375%, 11/15/2007 144A	B+		1,500,000		1,537,500
Manor Care, Inc., 8.00%, 03/01/2008	BBB		1,500,000		1,550,625
Omnicare, Inc., 8.125%, 03/15/2011 144A	BB+		950,000		985,625
Triad Hospitals, Inc, Ser. B, 8.75%, 05/01/2009	B-		1,650,000		1,699,500
					10,176,082
Pharmaceuticals–0.7%
King Pharmaceuticals, Inc., 10.75%, 02/15/2009	B+		1,000,000		1,102,500
INDUSTRIALS–7.0%
Aerospace & Defense–1.6%
BE Aerospace, Inc., 9.50%, 11/01/2008	B		1,650,000		1,163,250
Sequa Corp.:
8.875%, 04/01/2008	BB		500,000		417,500
9.00%, 08/01/2009	BB		1,000,000		860,000
					2,440,750
Commercial Services & Supplies–2.8%
Allied Waste North America, Inc., Ser. B, 10.00%, 08/01/2009	B+		1,650,000		1,658,250
Iron Mountain, Inc., 8.625%, 04/01/2013	B		1,500,000		1,522,500
Quebecor World, Inc., 7.75%, 02/15/2009	BBB		1,000,000		1,015,607
					4,196,357
Industrial Conglomerates–1.0%
United States Steel, LLC, 10.75%, 08/01/2008 144A	BB		1,650,000		1,542,750
Machinery–1.6%
AGCO Corp., 9.50%, 05/01/2008 144A	BB		1,650,000		1,617,000
Eagle-Picher Industries, Inc., 9.375%, 03/01/2008	B-		700,000		385,000
Terex Corp., 10.375%, 04/01/2011	B		475,000		458,375
					2,460,375
INFORMATION TECHNOLOGY–1.0%
IT Consulting & Services–0.6%
Sesi, LLC, 8.875%, 05/15/2011	BB-		1,000,000		920,000

60

EVERGREEN
Select High Yield Bond Fund
Schedule of Investments (continued)

September 30, 2001

	Credit Rating^	Principal Amount		Value
CORPORATE BONDS–continued
INFORMATION TECHNOLOGY–continued
Semiconductor Equipment & Products–0.4%
Fairchild Semiconductor Corp., 10.125%, 03/15/2007	B	$	635,000	$	600,075
MATERIALS–10.7%
Chemicals–4.8%
Airgas, Inc., 9.125%, 10/01/2011 144A	BB-		550,000		558,250
Equistar Chemicals, LP, 8.75%, 02/15/2009	BBB-		1,500,000		1,326,087
Lyondell Chemical Co., Ser. A, 9.625%, 05/01/2007	BB		1,650,000		1,522,125
Millennium America, Inc., 9.25%, 06/15/2008	BBB-		1,500,000		1,417,500
Noveon, Inc., Ser. B, 11.00%, 02/28/2011	B		1,500,000		1,477,500
Scotts Co., 8.625%, 01/15/2009	B+		1,000,000		995,000
					7,296,462
Containers & Packaging–3.1%
Four M Corp., Ser. B, 12.00%, 06/01/2006	B		1,650,000		1,460,250
Packaging Corp. of America, Ser. B, 9.625%, 04/01/2009	BB-		1,650,000		1,749,000
Stone Container Corp., 9.75%, 02/01/2011	B		1,500,000		1,522,500
					4,731,750
Metals & Mining–2.5%
Alaska Steel Corp., 7.875%, 02/15/2009	BB		1,650,000		1,551,000
Century Aluminum Co., 11.75%, 04/15/2008 144A	BB-		1,500,000		1,477,500
Peabody Energy Corp., Ser. B, 9.625%, 05/15/2008	B+		806,000		840,255
					3,868,755
Paper & Forest Products–0.3%
Louisiana Pacific Corp., 10.875%, 11/15/2008	BB-		500,000		462,500
TELECOMMUNICATION SERVICES–0.8%
Wireless Telecommunications Services–0.8%
Powertel, Inc., 11.125%, 06/01/2007	A-		600,000		645,000
Price Communications Wireless, Inc., Ser. B, 9.125%,
12/15/2006	B+		550,000		563,750
					1,208,750
UTILITIES–2.9%
Electric Utilities–1.7%
AES Corp., 8.50%, 11/01/2007	B+		1,225,000		998,375
Calpine Corp., 7.75%, 04/15/2009	BB+		1,650,000		1,555,282
					2,553,657
Gas Utilities–1.2%
El Paso Energy Partners LP, 8.50%, 06/01/2011 144A	BB-		500,000		505,000
Western Gas Resources, Inc., 10.00%, 06/15/2009	BB-		1,350,000		1,383,750
					1,888,750
Total Corporate Bonds					120,289,779

61

EVERGREEN
Select High Yield Bond Fund
Schedule of Investments (continued)

September 30, 2001

	Credit Rating^	Principal Amount		Value
YANKEE OBLIGATIONS-CORPORATE–5.7%
CONSUMER DISCRETIONARY–1.1%
Hotels, Restaurants & Leisure–0.6%
Intrawest Corp., 10.50%, 02/01/2010	B+	$	1,000,000	$	915,000
Media–0.5%
Rogers Cablesystems, Ltd., 11.00%, 12/01/2015	BB-		700,000		745,500
FINANCIALS–0.4%
Diversified Financials–0.4%
Tembec Finance Corp., 9.875%, 09/30/2005	BB+		550,000		566,500
MATERIALS–2.9%
Paper & Forest Products–2.9%
Doman Industries, Ltd., 12.00%, 07/01/2004	B+		950,000		859,750
Domtar, Inc., 8.75%, 08/01/2006	BBB-		670,000		736,077
Norampac, Inc., 9.50%, 02/01/2008	BB		1,650,000		1,687,125
Tembec Industries, Inc., 8.625%, 06/30/2009	BB+		1,100,000		1,116,500
					4,399,452
TELECOMMUNICATION SERVICES–1.3%
Diversified Telecommunication Services–0.7%
Star Choice Communications, 13.00%, 12/15/2005	B+		1,000,000		1,035,000
Wireless Telecommunications Services–0.6%
Rogers Cantel, Inc., 9.75%, 06/01/2016	BB+		1,000,000		970,000
Total Yankee Obligations-Corporate					8,631,452
			Shares		Value
PREFERRED STOCKS–0.7%
HEALTH CARE–0.7%
Health Care Providers & Services–0.7%
Fresenius Medical Care Capital Trust, 9.00%, 12/01/2006			10,000		1,022,500
SHORT-TERM INVESTMENTS–11.0%
MUTUAL FUND SHARES–11.0%
Evergreen Institutional Money Market Fund ø			16,876,400		16,876,400
Total Investments–(cost $151,596,866)–96.2%					146,820,131
Other Assets and Liabilities–3.8%					5,814,183
Net Assets–100.0%				$	152,634,314

See Combined Notes to Schedules of Investments.

62

EVERGREEN
Income Plus Fund
(formerly, Evergreen Select Income Plus Fund)
Schedule of Investments

September 30, 2001

	Credit Rating^	Principal Amount		Value
ASSET-BACKED SECURITIES–3.5%
Citibank Credit Card Master Trust I, Ser. 1999-2, Class A, 5.88%,
03/10/2011	AAA	$	15,440,000	$	16,004,610
Comed Transitional Funding Trust, Ser. 1998-1, Class A7, 5.74%,
12/25/2010	AAA		14,000,000		14,509,692
Corestates Home Equity Trust, Ser. 1993-2, Class A, 5.10%,
03/15/2009	AAA		119,460		119,861
Empire Funding Home Loan Owner Trust, Ser. 1998-1, Class A4,
6.64%, 12/25/2012	AAA		1,771,297		1,830,672
Saxon Asset Securities Trust, Ser. 1993-3, Class AF4, 7.55%,
10/25/2026	AAA		17,565,000		18,886,134
Sears Mtge. Securities Corp., Ser. 1999, Class PA19, 10.36%,
07/25/2018 144A @	AAA		77,089		76,318
Total Asset-Backed Securities					51,427,287
COLLATERALIZED MORTGAGE OBLIGATIONS–10.5%
FHLMC:
Ser. 1519, Class F, 6.75%, 03/15/2007	AAA		1,746,308		1,762,837
Ser. 1961, Class H, 6.50%, 05/15/2012	AAA		13,598,000		14,180,443
Ser. 2114, Class PF, 6.00%, 04/15/2027	AAA		10,000,000		10,094,050
Ser. 2132, Class PD, 6.00%, 11/15/2027	AAA		15,000,000		15,125,025
Ser. 2362, Class PC, 6.50%, 04/15/2017 @	AAA		16,410,000		17,158,296
Ser. A, Class 3, 11.88%, 06/15/2013	AAA		25,388		27,417
FNMA, Ser. 1999-60, Class CG, 6.00%, 10/18/2028	AAA		9,100,000		9,147,092
GMAC Comml. Mtge. Securities, Inc., Ser. 1998-C2, Class A1,
6.15%, 11/15/2007	AAA		10,566,707		11,027,357
GNMA, Ser. 1999, Class PC, 6.00%, 04/20/2024	AAA		15,902,000		16,499,041
Lehman Brothers Comml. Conduit Mtge. Trust, Ser. 1999-C1,
Class A1, 6.41%, 08/15/2007	AAA		16,839,221		17,749,192
Morgan Stanley Capital I, Inc., Ser. 1998, Class A2, 6.45%,
06/03/2030	AAA		11,144,000		11,784,838
Paine Webber Mtge. Acceptance Corp., Ser. 1999-C1, Class A2,
6.82%, 04/15/2009	AAA		10,315,000		11,051,550
Salomon Brothers Comml. Mtge. Trust, Ser. 2000-C3, Class A1,
6.34%, 07/18/2009	AAA		18,612,670		19,541,397
Salomon Brothers Mtge. Securities V, Ser. 1985-1, Class Z,
10.25%, 04/01/2016 @	AAA		1,997		1,977
Total Collateralized Mortgage Obligations					155,150,512
CORPORATE BONDS–31.0%
CONSUMER DISCRETIONARY–4.7%
Automobiles–1.2%
Ford Motor Co., 6.38%, 02/01/2029	A		6,500,000		5,343,696
General Motors Corp., 7.20%, 01/15/2011	A		12,500,000		12,708,900
					18,052,596

63

EVERGREEN
Income Plus Fund
(formerly, Evergreen Select Income Plus Fund)
Schedule of Investments (continued)

September 30, 2001

	Credit Rating^	Principal Amount		Value
CORPORATE BONDS–continued
CONSUMER DISCRETIONARY–continued
Hotels, Restaurants & Leisure–0.5%
McDonald’s Corp., 6.38%, 01/08/2028	AA	$	7,500,000	$	6,848,910
Media–1.3%
AOL Time Warner, Inc., 6.13%, 04/15/2006	BBB+		5,550,000		5,735,309
Comcast Cable Communications Corp., 6.20%, 11/15/2008	BBB		6,910,000		6,891,682
Time Warner, Inc., 8.18%, 08/15/2007	BBB+		5,000,000		5,620,005
					18,246,996
Multi-line Retail–1.7%
Dayton Hudson Corp., 5.88%, 11/01/2008	A+		3,500,000		3,602,280
May Department Stores Co., 8.75%, 05/15/2029	A+		2,000,000		2,327,826
Target Corp., 7.50%, 02/15/2005	A+		10,000,000		10,954,580
Wal-Mart Stores, Inc., 6.88%, 08/10/2009	AA		8,000,000		8,675,688
					25,560,374
CONSUMER STAPLES–1.2%
Beverages–0.6%
Coca Cola Enterprises, Inc., 6.95%, 11/15/2026	A		8,500,000		8,523,928
Household Products–0.6%
Procter & Gamble Co., 6.88%, 09/15/2009	AA		8,750,000		9,356,016
ENERGY–0.3%
Oil & Gas–0.3%
Texaco Capital, Inc., 5.50%, 01/15/2009	A+		5,000,000		4,955,885
FINANCIALS–15.5%
Banks–2.6%
Fleet Financial Group, Inc., 6.38%, 05/15/2008	A-		6,200,000		6,374,970
Mellon Capital I, Ser. A, 7.72%, 12/01/2026	A1		7,000,000		7,112,259
Mellon Capital II, Ser. B, 8.00%, 01/15/2027	A-		6,265,000		6,529,233
Washington Mutual, Inc., 6.88%, 06/15/2011	BBB+		6,000,000		6,306,246
Wells Fargo & Co.:
6.38%, 08/01/2011	A		3,300,000		3,402,396
6.63%, 07/15/2004	A+		8,360,000		8,946,144
					38,671,248
Diversified Financials–10.0%
Alliance Capital Management LP, 5.63%, 08/15/2006	A+		11,000,000		11,253,121
Boeing Capital Corp., 6.10%, 03/01/2011	AA-		15,805,000		15,486,719
Caterpillar Financial Services, 5.33%, 08/30/2004	A+		5,650,000		5,813,370
Duke Capital Corp., 7.25%, 10/01/2004	A		6,000,000		6,448,074
Ford Motor Credit Co., 7.38%, 10/28/2009	A		14,000,000		14,303,786
General Electric Capital Corp., MTN, Ser. A, 5.35%, 03/30/2006	AAA		7,300,000		7,497,516
GMAC, 6.88%, 09/15/2011	A		4,700,000		4,617,007

64

EVERGREEN
Income Plus Fund
(formerly, Evergreen Select Income Plus Fund)
Schedule of Investments (continued)

September 30, 2001

	Credit Rating^	Principal Amount		Value
CORPORATE BONDS–continued
FINANCIALS–continued
Diversified Financials–continued
Household Finance Corp.:
6.40%, 06/17/2008	A	$	5,000,000	$	5,133,680
7.20%, 07/15/2006	A		10,000,000		10,804,590
International Lease Finance Corp.:
5.35%, 05/03/2004	AA-		10,500,000		10,885,129
5.95%, 06/06/2005	AA-		10,000,000		10,466,710
John Deere Capital Corp., 5.52%, 04/30/2004	A		11,500,000		11,896,198
Morgan Stanley Group, Inc., 6.10%, 04/15/2006	AA-		15,000,000		15,522,255
PNC Funding Corp., 7.50%, 11/01/2009	BBB+		9,640,000		10,482,681
Texaco Capital, Inc., 9.75%, 03/15/2020	A+		5,000,000		6,495,415
					147,106,251
Insurance–1.2%
American General Finance Corp.:
5.88%, 07/14/2006	A+		11,100,000		11,512,886
7.45%, 01/15/2005	A+		5,465,000		5,970,316
					17,483,202
Real Estate–1.7%
Duke Weeks Realty, Ltd., 7.75%, 11/15/2009	BBB+		7,500,000		8,056,238
EOP Operating LP, 7.75%, 11/15/2007	BBB+		15,000,000		16,462,230
					24,518,468
HEALTH CARE–0.8%
Pharmaceuticals–0.8%
American Home Products Corp., 6.25%, 03/15/2006	A		11,750,000		12,268,386
INDUSTRIALS–1.4%
Aerospace & Defense–0.7%
United Technologies Corp., 7.00%, 09/15/2006	A+		9,000,000		9,773,631
Airlines–0.1%
Delta Air Lines, Inc., 8.30%, 12/15/2029	BB+		3,000,000		2,322,507
Machinery–0.6%
Ingersoll Rand Co., 6.25%, 05/15/2006	A-		8,750,000		9,051,639
INFORMATION TECHNOLOGY–1.2%
Communications Equipment–0.8%
SBC Communications, Inc., 5.75%, 05/02/2006	AA-		12,000,000		12,460,416
IT Consulting & Services–0.4%
Verizon Global Funding Corp., 7.75%, 12/01/2030	A+		5,215,000		5,621,327
MATERIALS–0.9%
Metals & Mining–0.9%
Alcoa, Inc., 6.50%, 06/01/2011	A+		12,000,000		12,549,000

65

EVERGREEN
Income Plus Fund
(formerly, Evergreen Select Income Plus Fund)
Schedule of Investments (continued)

September 30, 2001

	Credit Rating^	Principal Amount		Value
CORPORATE BONDS–continued
TELECOMMUNICATION SERVICES–5.0%
Diversified Telecommunication Services–5.0%
AT&T Corp., 6.50%, 03/15/2029	A	$	8,085,000	$	7,075,539
Bell Atlantic Financial Services, Inc., 5.75%, 04/01/2003	A+		12,000,000		12,270,000
Qwest Communications International, Inc., Ser. B, 7.50%,
11/01/2008	BBB+		10,500,000		10,987,127
Sprint Capital Corp.:
6.88%, 11/15/2028	BBB+		4,600,000		4,152,406
7.63%, 01/30/2011	BBB+		14,325,000		15,177,982
U.S. West Communications, Inc., 7.20%, 11/01/2004	BBB+		10,450,000		11,101,056
WorldCom, Inc.:
6.95%, 08/15/2028	BBB+		2,500,000		2,189,115
8.25%, 05/15/2031	BBB+		10,000,000		10,054,790
					73,008,015
Total Corporate Bonds					456,378,795
MORTGAGE-BACKED SECURITIES–37.6%
FHLMC:
6.00%, 05/01/2031-08/01/2031	AAA		60,987,728		60,921,583
7.03%, 12/01/2006	AAA		7,685,000		8,336,268
7.50%, 06/01/2030-10/01/2030	AAA		30,122,673		31,345,179
6.00%, TBA #	AAA		11,195,000		11,173,954
FNMA:
6.00%, 06/01/2016-05/01/2029 ##	AAA		121,966,463		123,658,668
6.09%, 05/01/2011	AAA		9,616,874		9,898,660
6.21%, 08/30/2001	AAA		6,073,889		6,309,442
6.23%, 06/01/2008 @	AAA		10,086,539		10,518,243
6.24%, 08/23/2001	AAA		3,784,272		3,935,518
6.29%, 05/01/2011 @	AAA		11,037,789		11,437,357
6.36%, 03/01/2011	AAA		7,460,799		7,717,354
6.42%, 08/23/2001	AAA		2,589,462		2,724,147
6.91%, 07/01/2007	AAA		8,039,762		8,699,197
7.03%, 01/01/2008	AAA		3,432,185		3,699,562
7.09%, 10/01/2007	AAA		4,835,955		5,276,474
7.13%, 12/01/2010	AAA		11,482,681		12,443,181
7.17%, 05/01/2007	AAA		10,198,556		11,127,815
7.29%, 01/01/2011	AAA		10,245,526		11,201,516
7.50%, 02/01/2012-02/01/2031	AAA		84,842,465		88,535,211
5.50%, TBA #	AAA		10,535,000		10,554,700
6.00%, TBA #	AAA		71,890,000		72,078,474
7.50%, TBA #	AAA		16,785,000		17,451,029

66

EVERGREEN
Income Plus Fund
(formerly, Evergreen Select Income Plus Fund)
Schedule of Investments (continued)

September 30, 2001

	Credit Rating^	Principal Amount		Value
MORTGAGE-BACKED SECURITIES–continued
GNMA:
8.00%, 06/15/2030	AAA	$	18,778,215	$	19,764,896
8.25%, 07/15/2008-05/15/2020	AAA		3,980,428		4,270,870
11.50%, 05/15/2013-06/15/2013	AAA		18,993		21,835
Total Mortgage-Backed Securities					553,101,133
U.S. TREASURY OBLIGATIONS–8.3%
U.S. Treasury Bonds, 6.25%, 08/15/2023	AAA		82,610,000		90,651,588
U.S. Treasury Notes:
3.38%, 01/15/2007	AAA		11,635,769		11,973,940
5.88%, 11/15/2004	AAA		10,206,000		10,947,537
6.00%, 08/15/2009	AAA		6,000,000		6,600,240
7.00%, 07/15/2006	AAA		2,410,000		2,730,737
Total U.S. Treasury Obligations					122,904,042
YANKEE OBLIGATIONS-CORPORATE–2.2%
CONSUMER DISCRETIONARY–1.5%
Wireless Telecommunications Services–1.5%
Vodafone Group Plc, 7.75%, 02/15/2010	A		20,085,000		22,012,959
INDUSTRIALS–0.7%
Industrial Conglomerates–0.7%
Tyco International Group SA, 5.875%, 11/01/2004	A		10,000,000		10,375,010
Total Yankee Obligations-Corporate					32,387,969
			Shares		Value
SHORT-TERM INVESTMENTS–13.3%
MUTUAL FUND SHARES–13.3%
Evergreen Institutional Money Market Fund ø			196,861,462		196,861,462
Total Investments–(cost $1,524,746,283)–106.4%					1,568,211,200
Other Assets and Liabilities–(6.4%)					(94,969,993	)
Net Assets–100.0%				$	1,473,241,207

See Combined Notes to Schedules of Investments.

67

EVERGREEN
Intermediate Term Municipal Bond Fund
(formerly, Evergreen Select Intermediate Term Municipal Bond Fund)
Schedule of Investments

September 30, 2001

	Credit Rating^	Principal Amount		Value
MUNICIPAL OBLIGATIONS–96.4%
AIRLINES–0.5%
Alliance Arpt. Auth., Inc. Texas RB, American Airlines, Inc.
Proj., 7.50%, 12/01/2029	BB	$	3,000,000	$	2,800,980
AIRPORT–9.9%
Chicago, IL O’Hare Intl. Arpt. RRB, United Airlines, Inc. Proj.,
Ser. A, 6.75%, 11/01/2011	B		19,360,000		17,579,267
Dallas Fort Worth, TX Intl. Arpt. RB, American Airlines, Inc.
Proj., Ser. A, 5.95%, 05/01/2029	BB		1,000,000		966,690
Denver, CO City & Cnty. Arpt. RB:
Ser. D, 7.75%, 11/15/2013	A		9,405,000		11,631,446
Rental Car Proj., Ser. A, 6.00%, 01/01/2011	AAA		3,025,000		3,338,813
Hawaii Arpt. Sys. RB, Ser. B, 6.50%, 07/01/2014	AAA		14,095,000		16,046,453
Houston, TX Arpt. Sys. RB, Continental Airlines Proj., Ser. E,
7.375%, 07/01/2022	BB-		10,000,000		8,565,600
					58,128,269
COMMUNITY DEVELOPMENT DISTRICT–0.5%
Frederick Cnty., MD Spl. Tax RB, 6.25%, 07/01/2010	NR		2,670,000		2,669,680
CONTINUING CARE RETIREMENT COMMUNITY–3.0%
Connecticut Dev. Auth. RRB, Church Homes, Inc. Proj.:
4.90%, 04/01/2002	BBB		425,000		425,939
5.00%, 04/01/2003	BBB		925,000		929,792
5.40%, 04/01/2007	BBB		1,220,000		1,219,646
5.70%, 04/01/2012	BBB		2,565,000		2,482,381
New Jersey EDA RB:
Fellowship Village Proj.:
Ser. A, 5.20%, 01/01/2009	BBB-		530,000		528,596
Ser. A, 5.30%, 01/01/2010	BBB-		585,000		581,402
Franciscan Oaks Proj.:
5.60%, 10/01/2012	NR		2,620,000		2,506,555
5.70%, 10/01/2017	NR		2,215,000		1,967,651
Keswick Pines Proj.:
5.60%, 01/01/2012	NR		900,000		863,847
5.70%, 01/01/2018	NR		3,550,000		3,207,709
The Evergreens Proj., 5.875%, 10/01/2012	NR		1,380,000		1,357,313
Palm Beach Cnty., FL, Hlth. Facs. Auth. RB:
Abbey DelRay So. Proj., 4.65%, 10/01/2001	BBB		750,000		750,052
Waterford Proj., 4.65%, 12/01/2014	BBB		725,000		725,051
					17,545,934
EDUCATION–5.7%
Massachusetts Edl. Fin. Auth. RRB, Ser. A, 5.50%, 12/01/2007	AAA		8,155,000		8,887,808
Montgomery Cnty., PA Higher Ed. Auth. RB, Beaver College Proj.,
5.80%, 04/01/2016	AAA		4,000,000		4,242,760

68

EVERGREEN
Intermediate Term Municipal Bond Fund
(formerly, Evergreen Select Intermediate Term Municipal Bond Fund)
Schedule of Investments (continued)

September 30, 2001

	Credit Rating^	Principal Amount		Value
MUNICIPAL OBLIGATIONS–continued
EDUCATION–continued
New York Dormitory Auth. RB, Ser. A, 5.50%, 05/15/2013	AA-	$	13,000,000	$	14,415,310
Pennsylvania Higher Edl. RB, UPMC Hlth. Sys., Ser. A, 6.25%,
01/15/2017	A+		5,535,000		5,961,306
					33,507,184
ELECTRIC REVENUE–3.3%
Central Valley, CA Fin. Auth. RB, Co-generation Proj., 6.00%,
07/01/2009	BBB-		8,950,000		9,343,979
Sullivan, IN PCRRB, Ser. C, 5.95%, 05/01/2009	BBB		10,000,000		10,095,700
					19,439,679
ESCROW–2.8%
Beaver Falls, PA Muni. Auth. RB, 9.125%, 08/01/2005	Aaa		1,055,000		1,280,475
Heartland Consumer Pwr. Dist. RB, 7.00%, 01/01/2016	AAA		5,000,000		5,950,300
Howell Township, NJ GO, 6.40%, 01/01/2003	AAA		2,000,000		2,060,140
Illinois Hlth. Facs. Auth. RB, Mercy Hosp. & Medical Ctr. Proj.,
10.00%, 01/01/2015	Aaa		4,535,000		6,269,910
Northampton Cnty., PA IDA RRB, Strawbridge Proj., 7.20%,
12/15/2001	BBB-		165,000		166,724
West View, PA Muni. Auth. Spl. Obl. Bonds, 9.20%, 05/15/2003	AAA		835,000		865,469
					16,593,018
GENERAL OBLIGATION–LOCAL–6.3%
Clark & Skamania Cnty., WA GO, Sch. Dist. 112-6, 5.75%,
12/01/2016	Aaa		2,790,000		3,006,086
Missouri Board of Pub. Bldgs. RRB, 6.00%, 12/01/2002	AA		3,000,000		3,019,170
New York, NY GO:
7.42%, 08/01/2013	A		5,000,000		5,461,400
Ser. A, 5.875%, 08/01/2003	A		5,535,000		5,847,395
Ser. A, 6.25%, 08/01/2010	A		2,500,000		2,816,225
Ser. A, 6.25%, 08/01/2011	A		3,000,000		3,372,360
Ser. C, 6.50%, 02/01/2008	A		5,795,000		6,588,625
Ser. I, 6.50%, 03/15/2005	A		6,000,000		6,615,240
					36,726,501
GENERAL OBLIGATION–STATE–2.4%
Washington GO, Ser. B, 6.40%, 06/01/2017	AA+		12,000,000		14,132,280
HOSPITAL–9.6%
Alamogordo, NM Hosp. RB, 5.00%, 01/01/2008	A-		5,680,000		5,839,267
Coffee Cnty., GA Hosp. Auth. RB, Ser. A, 6.75%, 12/01/2026	NR		1,500,000		1,476,630
Illinois Hlth. Facs. Auth. RB, Edward Hosp. Proj., Ser. A, 6.00%,
02/15/2019	A+		5,600,000		5,698,560
Indiana Hlth. Facs. Auth. Hosp. RB, Memorial Hosp. Proj., 7.35%,
03/01/2012	Baa2		2,000,000		2,054,200

69

EVERGREEN
Intermediate Term Municipal Bond Fund
(formerly, Evergreen Select Intermediate Term Municipal Bond Fund)
Schedule of Investments (continued)

September 30, 2001

	Credit Rating^	Principal Amount		Value
MUNICIPAL OBLIGATIONS–continued
HOSPITAL–continued
Massachusetts Hlth. & Ed. RB, Partners Hlth. Care Sys., Ser. C:
6.00%, 07/01/2016	AA-	$	1,000,000	$	1,082,340
6.00%, 07/01/2017	AA-		1,500,000		1,610,580
Michigan Hosp. Fin. Auth. RB:
Trinity Hlth. Proj., Ser. A, 6.00%, 12/01/2013	AA-		4,675,000		5,102,716
Trinity Hlth. Proj., Ser. A, 6.00%, 12/01/2014	AA-		4,865,000		5,272,444
North Carolina Med. Care Commission Hosp. RB, Transylvania
Community Hosp. Proj.:
4.70%, 10/01/2001	NR		140,000		140,010
4.80%, 10/01/2002	NR		155,000		156,100
Shawnee, OK Hosp. Auth. RRB, Midamerica Healthcare Proj.,
6.125%, 10/01/2014	BBB		8,500,000		8,534,935
Wichita, KS Hosp. RRB, Ser. 11, 6.75%, 11/15/2014	A+		5,840,000		6,592,134
Wisconsin Hlth. & Edl. Facs. Auth. RB:
Med College, Inc. Proj., 5.95%, 12/01/2015	A		6,865,000		7,045,549
Mercy Hosp. Of Janesville, Inc. Proj., 6.50%, 08/15/2011	A2		5,300,000		5,479,935
					56,085,400
HOUSING–16.8%
California HFA RB:
Ser. A, 7.55%, 08/01/2003	A+		2,335,000		2,431,202
Ser. L, 0.00%, 08/01/2027 ¤	AAA		7,870,000		1,975,055
Colorado HFA SFHRB:
Ser. C-2, 6.875%, 11/01/2028	Aa2		1,890,000		2,057,530
Ser. C-3, 6.75%, 05/01/2017	Aa2		840,000		912,794
Jefferson Parish, LA Home Mtge. Auth. SFHRRB, Ser. B-1,
6.75%, 06/01/2030	Aaa		1,940,000		2,153,478
Massachusetts HFA RB:
9.46%, 10/01/2015	AAA		6,500,000		6,967,090
Ser. C, 6.35%, 05/15/2003	AAA		2,000,000		2,082,280
Michigan Hsg. Dev. Auth. RB, 9.66%, 10/01/2015	AA-		7,500,000		8,346,450
Minnesota HFA SFHRB, Single Family Mtge.:
Ser. B, 6.20%, 01/01/2021	AA+		5,070,000		5,320,914
Ser. E, 6.85%, 01/01/2024	AA+		9,840,000		10,117,685
Mississippi Home Corp. SFHRB, Ser. H, Class 6, 6.70%,
12/01/2029	Aaa		7,230,000		7,902,173
Missouri Hsg. Dev. Commission SFHRB:
Ser. A-1, 7.50%, 03/01/2031	AAA		2,360,000		2,700,336
Ser. C-1, 6.95%, 09/01/2030	AAA		8,345,000		9,416,498
Nevada Hsg. Division SFHRB, Ser. A-1, 7.55%, 10/01/2010	AA		225,000		226,485
New Hampshire HFA SFHRB, Ser. D, 6.15%, 07/01/2029	Aa3		2,085,000		2,266,958
New Jersey Hsg. & Mtge. Fin., Ser. 1, 6.70%, 11/01/2028	A+		220,000		229,761
New Mexico Mtge. Fin. Auth. SFHRB:
Ser. A-2, 7.10%, 09/01/2030	AAA		1,575,000		1,793,988
Ser. E-2, 6.55%, 09/01/2031	AAA		6,000,000		6,740,220

70

EVERGREEN
Intermediate Term Municipal Bond Fund
(formerly, Evergreen Select Intermediate Term Municipal Bond Fund)
Schedule of Investments (continued)

September 30, 2001

	Credit Rating^	Principal Amount		Value
MUNICIPAL OBLIGATIONS–continued
HOUSING–continued
New York Hsg. Fin. Service Contract RB, Ser. C, 5.875%,
09/15/2014	AA-	$	5,085,000	$	5,309,096
Ohio HFA Mtge. RB, Ser. C, 5.625%, 03/01/2032,
(LOC: GNMA)	Aaa		5,620,000		5,943,150
Oklahoma HFA SFHRB, Ser. D-1, 7.10%, 09/01/2016	Aaa		1,760,000		1,966,448
Symrna, TN Hsg. Assn. MHRB, Ser. A, 6.45%, 10/20/2035,
(LOC: GNMA)	AAA		8,980,000		9,819,091
Texas Dept. of Hsg. & Community Affairs MHRB, Ser. A, 5.55%,
01/01/2005	A		1,645,000		1,679,183
Utah HFA SFHRB, Ser. G-1, 7.35%, 07/01/2018	AAA		310,000		324,366
					98,682,231
INDUSTRIAL DEVELOPMENT REVENUE–7.9%
Boston, MA IDA RB, Pilot Seafood Proj., 5.875%, 04/01/2030	AA-		5,000,000		5,099,900
Escambia Cnty., FL PCRB, Champion Intl. Corp. Proj., 6.90%,
08/01/2022	BBB		7,125,000		7,461,371
Iowa Fin. Auth. RB, Trinity Hlth. Proj., Ser. B, 5.75%,
12/01/2015	AA-		4,240,000		4,470,105
Maricopa Cnty., AZ PCRB, El Paso Elec. Proj., 6.375%,
08/01/2015	NR		8,500,000		8,933,500
Mason Cnty., WV PCRB, Appalachian Pwr. Co. Proj., Ser. I,
6.85%, 06/01/2022	BBB+		3,000,000		3,086,040
Michigan Pub. Pwr. Agcy. RB, 5.50%, 01/01/2013	AA-		10,000,000		10,302,200
Oakes, ND IDRB, Omniquip Intl., Inc. Proj., 5.80%, 02/01/2014	NR		4,150,000		4,080,114
Toledo, OH Port Auth. RB, 5.90%, 12/01/2015	Aa3		3,000,000		3,114,000
					46,547,230
LEASE–3.7%
Denver, CO City & Cnty. Sch. Dist. RB, Ser. B, 6.50%,
12/01/2002	A+		1,000,000		1,017,230
Michigan COP, 5.75%, 06/01/2015	AAA		2,320,000		2,524,485
Texas Natl. Research Lab. Commission RB, 6.95%, 12/01/2012	AAA		15,000,000		18,050,250
					21,591,965
PORT AUTHORITY–1.9%
Port Auth. of NY & NJ RB, Ser. 4, 6.75%, 10/01/2011	NR		10,500,000		11,104,800
PRE-REFUNDED–2.5%
Arapahoe Cnty., CO Capital Impt. Hwy. RB, Ser. E-470, 6.90%,
08/31/2015	Aaa		4,000,000		4,683,760
Cherry Hill Township, NJ GO, 5.80%, 06/01/2004	Aa2		705,000		736,323
New York City Muni. Wtr. Fin. Auth. RB, Ser. B, 6.25%,
06/15/2020	AAA		8,000,000		9,196,400
					14,616,483

71

EVERGREEN
Intermediate Term Municipal Bond Fund
(formerly, Evergreen Select Intermediate Term Municipal Bond Fund)
Schedule of Investments (continued)

September 30, 2001

	Credit Rating^	Principal Amount		Value
MUNICIPAL OBLIGATIONS–continued
PUBLIC FACILITIES–2.5%
Dauphin Cnty., PA General Auth. RB, Ser. A:
5.50%, 01/15/2008	NR	$	7,865,000	$	7,648,476
5.75%, 01/15/2010	NR		3,950,000		3,855,595
Hartford, CT Parking Systems RB, Ser. A, 6.50%, 07/01/2025	BBB		2,740,000		2,887,248
					14,391,319
RESOURCE RECOVERY–1.0%
Pennsylvania Econ. Dev. Fin. Auth. Resource Recovery RB,
Ser. D, Colver Proj.:
7.125%, 12/01/2015	BBB-		2,000,000		2,090,480
7.15%, 12/01/2018	BBB-		3,500,000		3,638,600
					5,729,080
SALES TAX–1.5%
Pennsylvania Convention Ctr. RRB, Ser. A, 6.75%, 09/01/2019,
(Insd. by MBIA)	AAA		8,000,000		8,932,560
SOLID WASTE–1.7%
Blytheville, AR Solid Wst. RB, 6.90%, 12/01/2021	AA-		3,500,000		3,585,785
Delaware Solid Wst. Auth. RRB, Ser. A, 6.75%, 07/01/2003	A		3,000,000		3,039,300
Niagara Cnty., NY IDA RB, Ser. B, 5.55%, 11/15/2024	BBB		3,000,000		3,123,750
					9,748,835
SPECIAL TAX–0.8%
Allegheny Cnty., PA Redev. Auth. RB, Waterfront Proj.:
Ser. A, 5.875%, 12/15/2010	NR		2,530,000		2,752,007
Ser. B, 5.75%, 12/15/2005	NR		1,760,000		1,874,013
					4,626,020
STUDENT LOAN–2.9%
Alaska Student Loan Corp. RB, Ser. A:
5.80%, 07/01/2012	AAA		2,935,000		3,151,280
5.85%, 07/01/2013	AAA		3,285,000		3,507,198
5.90%, 07/01/2014	AAA		3,600,000		3,824,064
Arkansas Student Loan Auth. RB, Ser. B, 5.35%, 06/01/2009	A		6,465,000		6,733,491
					17,216,033
TOBACCO REVENUE–2.8%
Tobacco Settlement Revenue Mgmt. Auth. RB, Ser. B, SC
Tobacco Settlement:
6.00%, 05/15/2022	A		2,875,000		3,020,044
6.375%, 05/15/2030	A		2,300,000		2,549,090
TSASC, Inc., NY RB, Ser. 1, 5.70%, 07/15/2014	A		2,900,000		3,104,595
Washington, DC Tobacco Settlement Financing Corp. RB, 6.25%,
05/15/2024	A		7,500,000		8,028,750
					16,702,479

72

EVERGREEN
Intermediate Term Municipal Bond Fund
(formerly, Evergreen Select Intermediate Term Municipal Bond Fund)
Schedule of Investments (continued)

September 30, 2001

	Credit Rating^	Principal Amount		Value
MUNICIPAL OBLIGATIONS–continued
TRANSPORTATION–0.2%
New Jersey Hwy. Auth. RB, Garden State Pkwy. Proj., 6.25%,
01/01/2014	AA-	$	875,000	$	900,252
UTILITY–0.7%
Grand Prairie, TX Metro. Util. GO, 6.50%, 04/01/2012	A		3,740,000		4,063,360
WATER & SEWER–5.5%
Ashland, KY PCRB, Ashland Oil, Inc. Proj., 6.65%, 08/01/2009	Baa2		5,000,000		5,162,650
Dickinson Cnty., MI Econ. Dev. Corp. RB, 6.55%, 03/01/2007	BBB		5,000,000		5,094,150
Huntsville, AL Solid Wst. Disposal Auth. RRB:
5.75%, 10/01/2009	AAA		7,865,000		8,675,567
5.75%, 10/01/2012	AAA		9,210,000		10,033,558
Texas Gulf Coast Wst. Disposal Auth. RB, Champion Intl. Corp.
Proj., 7.45%, 05/01/2026	BBB		3,400,000		3,528,248
					32,494,173
Total Municipal Obligations					564,975,745
		Shares		Value
SHORT-TERM INVESTMENTS–1.3%
MUTUAL FUND SHARES–1.3%
Evergreen Institutional Municipal Money Market Fund ø			7,455,805		7,455,805
Total Investments–(cost $550,254,876)–97.7%					572,431,550
Other Assets and Liabilities–2.3%					13,350,879
Net Assets–100.0%				$	585,782,429

The following table shows the percent of portfolio assets invested
by geographic location as of September 30, 2001:
(unaudited)

New York	13.4%	Wisconsin	2.2%	South Dakota	1.0%
Pennsylvania	7.6%	Indiana	2.1%	South Carolina	1.0%
Texas	6.9%	Oklahoma	1.8%	North Carolina	1.0%
Michigan	6.4%	Arkansas	1.8%	Kentucky	0.9%
Illinois	5.2%	Alaska	1.8%	Iowa	0.8%
Massachusetts	4.5%	Tennessee	1.7%	North Dakota	0.7%
Colorado	4.1%	Ohio	1.6%	West Virginia	0.5%
Alabama	3.3%	Florida	1.6%	Delaware	0.5%
Washington	3.0%	Arizona	1.6%	Louisiana	0.4%
Hawaii	2.8%	Missouri	1.4%	Georgia	0.3%
Minnesota	2.7%	Mississippi	1.4%	Other	2.5%
New Jersey	2.6%	District of Columbia	1.4%
New Mexico	2.5%	Connecticut	1.4%		100.0%
California	2.4%	Kansas	1.2%

See Combined Notes to Schedules of Investments.

73

EVERGREEN
Limited Duration Fund
(formerly, Evergreen Select Limited Duration Fund)
Schedule of Investments

September 30, 2001

	Credit Rating^	Principal Amount		Value
ASSET-BACKED SECURITIES–4.9%
Advanta Mtge. Loan Trust, Ser. 1993-3, Class A1, 4.90%,
01/25/2010	AAA	$	58,736	$	58,915
Associates Auto Receivables Trust, Ser. 2000-2, Class A4,
6.90%, 08/15/2005	AA		4,000,000		4,269,987
BankBoston Receivable Asset-Backed Trust, Ser. 1997-1,
Class A7, 6.48%, 07/15/2008	AAA		1,297,114		1,312,017
Case Equipment Loan Trust, Ser. 1998-A, Class A4, 5.83%,
02/15/2005	AAA		274,187		274,788
Chase Credit Card Owner Trust, Ser. 1999-3, Class A, 6.66%,
01/15/2007	AAA		5,000,000		5,361,895
CIT Receivables Trust, Ser. 1995-B, Class A, 6.50%, 04/15/2011	AAA		49,317		50,550
Daimler-Benz Vehicle Trust, Ser. 1998-A, Class A4, 5.22%,
12/22/2003	AAA		1,843,706		1,868,615
GE Capital Mtge. Services, Inc., Ser. 1998-1, Class A4, 6.44%,
10/25/2016	Aaa		3,422,304		3,452,363
MBNA Master Credit Card Trust, Ser. 1996-J, Class A, 3.79%,
02/15/2006	AAA		760,000		762,025
Prudential Financial Asset Funding Corp., Ser. 1993-8, Class A,
5.78%, 11/15/2014	AAA		87,926		89,681
SLMA, Ser. 1997-1, Class A1, 3.89%, 10/25/2005	AAA		159,520		159,521
WFS Finance Owner Trust, Ser. 1998-A, Class A4, 5.95%,
05/20/2005	AAA		99,510		100,066
Total Asset-Backed Securities					17,760,423
COLLATERALIZED MORTGAGE OBLIGATIONS–14.9%
Blackrock Capital Finance, LP, Ser. 1997-C1, Class D, 7.15%,
10/25/2026	NA		2,651,746		2,662,064
Commerce 2000, Ser. 2000-FL1A, Class H, 4.91%, 12/16/2011
144A	Baa3		3,520,000		3,488,214
Credit Suisse First Boston Mtge. Corp.:
Ser. 1998-FL2A, Class D, 5.04%, 08/15/2013 144A	Baa2		7,500,000		7,508,740
Ser. 2001-CP4 Class A1, 5.26%, 12/15/2035	AAA		3,476,246		3,544,390
Deutsche Mtge. & Asset Receiving Corp., Ser. 1998-C1,
Class A1, 6.22%, 09/15/2007	Aaa		1,923,912		2,007,234
DLJ Comml. Mtge. Corp., Ser. 1998 Class B, 5.81%,
01/08/2011	Ba2		1,494,762		1,494,529
FHLB, 4.63%, 08/13/2004	AAA		5,000,000		5,144,685
FHLMC:
5.65%, 11/15/2024	AAA		4,000,000		4,060,060
Ser. 1916, Class PB, 6.50%, 08/15/2011	AAA		3,705,395		3,844,633
Ser. 2052, Class PT, 6.00%, 12/15/2009	AAA		1,153,994		1,180,818
Fortress Comml. Mtge. Trust, Ser. 1999-PC1, Class C, 5.48%,
12/10/2004 144A @	Aaa		2,135,930		2,142,278

74

EVERGREEN
Limited Duration Fund
(formerly, Evergreen Select Limited Duration Fund)
Schedule of Investments (continued)

September 30, 2001

	Credit Rating^	Principal Amount		Value
COLLATERALIZED MORTGAGE OBLIGATIONS–continued
GMAC:
7.63%, 06/15/2004	A	$	3,500,000	$	3,725,883
Ser. 1999-FL1, Class E, 5.53%, 10/15/2009 144A	Baa3		5,000,000		4,989,840
SASCO Comml. Mtge. Trust, Ser. 1999-C3, Class H, 5.06%,
03/20/2002 144A	Baa1		4,102,291		4,110,142
Starwood Asset Receivables Trust, Ser. 2000-1, Class E, 6.33%,
01/25/2005	NA		4,000,000		4,038,068
Total Collateralized Mortgage Obligations					53,941,578
CORPORATE BONDS–66.6%
CONSUMER DISCRETIONARY–2.0%
Automobiles–1.0%
Daimler Chrysler North America, 7.40%, 01/20/2005	A-		3,500,000		3,721,172
Media–1.0%
AOL Time Warner, Inc., 9.63%, 05/01/2002	BBB+		3,500,000		3,616,183
CONSUMER STAPLES–3.7%
Food & Drug Retailing–1.4%
Safeway, Inc., 7.00%, 09/15/2002	BBB		5,000,000		5,129,770
Food Products–1.4%
Kellogg Co., 5.50%, 04/01/2003	BBB		5,000,000		5,108,640
Tobacco–0.9%
Philip Morris Companies, Inc., 7.25%, 01/15/2003	A-		3,000,000		3,126,594
ENERGY–2.1%
Oil & Gas–2.1%
Dynegy Holdings, Inc., 8.13%, 03/15/2005	BBB+		3,500,000		3,805,494
Oryx Energy Co., 8.00%, 10/15/2003	BBB		3,500,000		3,765,059
					7,570,553
FINANCIALS–32.0%
Banks–8.7%
Banc America, Inc., 4.60%, 01/27/2006 @	BBB+		3,500,000		3,499,453
Bank One Corp., 5.63%, 02/17/2004	A		3,500,000		3,626,984
Capital One Bank, 8.25%, 06/15/2005	BBB-		3,500,000		3,648,827
Mellon Financial Co.:
5.75%, 11/15/2003	A+		3,000,000		3,130,413
6.00%, 03/01/2004	A+		1,797,000		1,874,196
Norwest Corp., 6.63%, 03/15/2003	A		5,000,000		5,231,645
PNC Funding Corp., 7.00%, 09/01/2004	A-		3,500,000		3,756,459
Southtrust Corp., 7.00%, 05/15/2003	BBB+		3,500,000		3,674,051
United States Bancorp, 3.91%, 02/03/2003	A		3,000,000		3,012,534
					31,454,562

75

EVERGREEN
Limited Duration Fund
(formerly, Evergreen Select Limited Duration Fund)
Schedule of Investments (continued)

September 30, 2001

	Credit Rating^	Principal Amount		Value
CORPORATE BONDS–continued
FINANCIALS–continued
Diversified Financials–17.9%
Bear Stearns Companies, Inc. MTN, 7.33%, 10/28/2004	A	$	3,500,000	$	3,756,249
Country Home Loan, Inc., 6.85%, 06/15/2004	A		4,410,000		4,711,432
Ford Motor Credit Co., 4.73%, 03/08/2004	A		5,000,000		4,984,020
Goldman Sachs Group, Inc., 7.63%, 08/17/2005	A+		4,000,000		4,372,052
Heller Financial, Inc., 7.88%, 05/15/2003	A-		5,000,000		5,341,220
Household Finance Corp., 6.00%, 05/01/2004	A		5,000,000		5,213,025
Lehman Brothers Holdings, Inc., MTN, 6.63%, 12/27/2002	A		5,000,000		5,183,785
Merrill Lynch & Co., Inc., 5.70%, 02/06/2004	AA-		5,000,000		5,199,820
Morgan Stanley Dean Witter, 3.91%, 08/07/2003	AA-		5,000,000		5,007,880
Nisource Finance Corp., 7.50%, 11/15/2003	BBB		5,000,000		5,303,665
Paine Webber Group, Inc., 6.38%, 05/15/2004	AA+		5,000,000		5,297,980
U.S. West Capital Funding, Inc., 6.13%, 07/15/2002	BBB+		5,000,000		5,080,185
USAA Capital Corp., 7.41%, 06/30/2003 144A	AAA		5,000,000		5,305,300
					64,756,613
Insurance–2.6%
American General Financial Corp., 6.75%, 11/15/2004	A+		3,500,000		3,751,447
St. Paul Companies, Inc., 7.88%, 04/15/2005	A+		5,000,000		5,482,310
					9,233,757
Real Estate–2.8%
Avalon Bay Communities, Inc., 6.50%, 07/15/2003	BBB+		3,500,000		3,630,042
EOP Operating, LP, 6.50%, 01/15/2004	BBB+		2,500,000		2,606,368
Spieker Properties, LP, 6.90%, 01/15/2004	BBB+		3,703,000		3,871,212
					10,107,622
HEALTH CARE–1.3%
Health Care Providers & Services–1.3%
Cardinal Health, Inc., 6.50%, 02/15/2004	A		4,450,000		4,702,546
INDUSTRIALS–5.3%
Aerospace & Defense–1.0%
United Technologies Corp., 6.63%, 11/15/2004	A+		3,500,000		3,738,700
Airlines–0.7%
Continental Airlines, 6.41%, 04/15/2007	AA		2,447,750		2,451,750
Industrial Conglomerates–1.0%
Tyco International Group, 4.95%, 08/01/2003	A		3,500,000		3,554,614
Road & Rail–2.6%
Burlington Northern Santa Fe Corp., 7.00%, 08/01/2002	BBB+		5,500,000		5,677,881
Union Pacific Corp., 7.88%, 02/15/2002	BBB-		3,500,000		3,554,194
					9,232,075

76

EVERGREEN
Limited Duration Fund
(formerly, Evergreen Select Limited Duration Fund)
Schedule of Investments (continued)

September 30, 2001

	Credit Rating^	Principal Amount		Value
CORPORATE BONDS–continued
INFORMATION TECHNOLOGY–4.6%
Computers & Peripherals–1.4%
Sun Microsystems, Inc., 7.00%, 08/15/2002	BBB+	$	5,015,000	$	5,119,668
Semiconductor Equipment & Products–1.5%
Texas Instruments, Inc., 7.00%, 08/15/2004	A		5,000,000		5,318,790
Software–1.7%
Aristar, Inc., 7.38%, 09/01/2004	A-		3,500,000		3,759,850
Oracle Corp., 6.72%, 02/15/2004	A-		2,145,000		2,228,576
					5,988,426
TELECOMMUNICATION SERVICES–8.6%
Diversified Telecommunication Services–7.1%
Alltel Corp., 7.25%, 04/01/2004	A		5,000,000		5,304,900
Comcast Cable Communications, 8.13%, 05/01/2004	BBB		5,000,000		5,425,065
Cox Communications, Inc., 6.15%, 08/01/2003	BBB		2,300,000		2,367,494
GTE North, Inc., 6.00%, 01/15/2004	A+		3,500,000		3,656,104
Sprint Capital Corp., 5.70%, 11/15/2003	BBB+		5,500,000		5,607,475
United Telecommunications, 9.50%, 04/01/2003	BBB+		3,000,000		3,236,871
					25,597,909
Wireless Telecommunications Services–1.5%
Airtouch Communications, Inc., 7.00%, 10/01/2003	A		5,000,000		5,294,625
UTILITIES–7.0%
Electric Utilities–5.4%
Commonwealth Edison Co., Ser. 85, 7.38%, 09/15/2002	A-		5,000,000		5,162,235
Dominion Resources, Inc., 7.40%, 09/16/2002	BBB+		5,000,000		5,159,745
Niagara Mohawk Power Corp., 5.88%, 09/01/2002	BBB+		5,000,000		5,095,640
Progress Energy, Inc., 6.55%, 03/01/2004	BBB		4,000,000		4,210,500
					19,628,120
Gas Utilities–1.6%
Coastal Corp.:
6.20%, 05/15/2004	Baa2		5,000,000		5,125,215
8.13%, 09/15/2002	BBB		590,000		614,116
					5,739,331
Total Corporate Bonds					240,192,020
MORTGAGE-BACKED SECURITIES–7.8%
FHLMC:
6.50%, 07/01/2004-09/01/2008	AAA		4,630,452		4,794,879
FNMA:
5.25%, 06/15/2006	AAA		10,000,000		10,418,490
5.50%, 01/25/2022	AAA		5,000,000		5,067,975
6.50%, 09/01/2005-08/01/2010	AAA		926,442		958,442
7.20%, 04/25/2023	AAA		2,367,147		2,382,190

77

EVERGREEN
Limited Duration Fund
(formerly, Evergreen Select Limited Duration Fund)
Schedule of Investments (continued)

September 30, 2001

	Credit Rating^	Principal Amount		Value
MORTGAGE-BACKED SECURITIES–continued
GNMA:
6.50%, 12/15/2008-10/15/2010	AAA	$	528,407	$	554,715
7.50%, 07/20/2002-05/20/2023	AAA		2,285,798		2,325,046
8.00%, 08/15/2007	AAA		2,188		2,323
8.25%, 07/15/2002	AAA		1,855		1,885
8.50%, 06/20/2005-09/20/2005	AAA		149,044		155,722
9.00%, 09/15/2003-08/15/2022	AAA		730,400		794,507
9.50%, 07/15/2002	AAA		10,213		10,446
10.00%, 01/20/2003-03/20/2004	AAA		8,036		8,535
14.00%, 02/15/2012-06/15/2012	AAA		548,019		660,902
Total Mortgage-Backed Securities					28,136,057
U.S. GOVERNMENT & AGENCY OBLIGATIONS–0.1%
FHLB, 6.52%, 02/27/2002	AAA		200,000		209,733
U.S. TREASURY OBLIGATIONS–1.5%
U.S. Treasury Notes, 5.875%, 11/15/2004	AAA		5,000,000		5,363,285
			Shares		Value
SHORT-TERM INVESTMENTS–2.9%
MUTUAL FUND SHARES–2.9%
Evergreen Institutional Money Market Fund ø			10,319,104		10,319,104
Total Investments–(cost $345,917,571)–98.7%					355,922,200
Other Assets and Liabilities–1.3%					4,714,781
Net Assets–100.0%				$	360,636,981

See Combined Notes to Schedules of Investments.

78

Combined Notes to Schedules of Investments

September 30, 2001

144A	Security that may be sold to qualified institutional buyers under Rule 144A of the Securities Act of 1933, as amended. This security has been determined to be liquid under guidelines established by the Board of Trustees.
¤	Security issued in zero coupon form with no periodic interest payments but is acquired at a discount that results in a current yield to maturity. An effective interest rate is applied to recognize interest income daily for the bond. This rate is based on total expected income to be earned over the life of the bond from amortization of discount at acquisition.
@	No market quotation available. Valued at fair value as determined in good faith under procedures established by the Board of Trustees.
^	Credit ratings are unaudited and rated by Moody’s Investors Service where Standard and Poor’s ratings are not available.
ø	The advisor of the Fund and the advisor of the money market fund are each a subsidiary of Wachovia Corporation.
#	When-issued security.
##	All or a portion of the security has been segregated for when-issued securities.

Summary of Abbreviations:

AMBAC	American Municipal Bond Assurance Corp.
COP	Certificates of Participation
EDA	Economic Development Authority
FHLB	Federal Home Loan Banks
FHLMC	Federal Home Loan Mortgage Corp.
FNMA	Federal National Mortgage Association
GNMA	Government National Mortgage Association
GO	General Obligation
HFA	Housing Finance Authority
IDA	Industrial Development Authority
IDRB	Industrial Development Revenue Bond
LOC	Letter of Credit
MBIA	Municipal Bond Investors Assurance Corp.
MHRB	Multifamily Housing Revenue Bond
MTN	Medium Term Note
PCRB	Pollution Control Revenue Bond
PCRRB	Pollution Control Refunding Revenue Bond
RB	Revenue Bond
REIT	Real Estate Investment Trust
RRB	Refunding Revenue Bond
SFHRB	Single Family Housing Revenue Bond
SFHRRB	Single Family Housing Refunding Revenue Bond
SLMA	Student Loan Marketing Association
TBA	To Be Announced

See Combined Notes to Financial Statements.

79

EVERGREEN
Fixed Income Funds(formerly, Evergreen Select Fixed Income Funds)
Statements of Assets and Liabilities

September 30, 2001

	Adjustable Rate Fund			Core Bond Fund		Fixed Income Fund			Fixed Income Fund II
Assets
Identified cost of securities	$	949,994,095		$	1,915,004,910	$	541,609,350		$	46,804,545
Net unrealized gains on securities		7,710,549			56,966,592		16,018,502			1,093,411
Market value of securities		957,704,644			1,971,971,502		557,627,852			47,897,956
Cash		1,448			0		0			0
Receivable for securities sold		0			0		19,400,243			1,032,640
Principal paydown receivable		2,144,903			0		0			0
Receivable for Fund shares sold		48,736,949			9,722,508		391,047			23,100
Interest and dividends receivable		5,435,394			15,550,968		6,294,231			410,244
Prepaid expenses and other assets		86,626			78,209		35,630			84,424
Total assets		1,014,109,964			1,997,323,187		583,749,003			49,448,364
Liabilities
Distributions payable		1,060,044			4,375,564		1,725,142			90,151
Payable for securities purchased		65,760,095			273,095,443		53,067,515			4,272,429
Payable for Fund shares redeemed		1,936,016			3,771,361		1,480,923			25,000
Advisory fee payable		15,809			9,405		18,225			0
Distribution Plan expenses payable		45,844			7,432		286			0
Due to other related parties		7,528			14,061		4,339			0
Accrued expenses and other liabilities		115,043			73,282		60,271			38
Total liabilities		68,940,379			281,346,548		56,356,701			4,387,618
Net assets	$	945,169,585		$	1,715,976,639	$	527,392,302		$	45,060,746
Net assets represented by
Paid-in capital	$	940,783,286		$	1,638,672,827	$	502,085,643		$	45,733,259
Undistributed (overdistributed) net investment income		(1,049,563	)		332,118		(1,740,879	)		(373,643	)
Accumulated net realized gains or losses on securities		(2,274,687	)		20,005,102		11,029,036			(1,392,281	)
Net unrealized gains on securities		7,710,549			56,966,592		16,018,502			1,093,411
Total net assets	$	945,169,585		$	1,715,976,639	$	527,392,302		$	45,060,746
Net assets consists of
Class A	$	190,055,150		$	98,424,305	$	0		$	0
Class B		173,276,167			40,077,740		0			0
Class C		348,001,754			24,694,852		0			0
Class I		140,978,822			1,532,323,502		513,229,801			45,059,618
Class IS		92,857,692			20,456,240		14,162,501			1,128
Total net assets	$	945,169,585		$	1,715,976,639	$	527,392,302		$	45,060,746
Shares outstanding
Class A		19,636,585			9,132,645		0			0
Class B		17,903,580			3,718,791		0			0
Class C		35,956,254			2,291,460		0			0
Class I		14,566,814			142,182,611		83,051,647			3,508,376
Class IS		9,594,441			1,898,051		2,291,882			88
Net asset value per share
Class A	$	9.68		$	10.78		—			—
Class A—Offering price (based on sales charge of 3.25% and       4.75%, respectively)	$	10.01		$	11.32		—			—
Class B	$	9.68		$	10.78		—			—
Class C	$	9.68		$	10.78		—			—
Class I	$	9.68		$	10.78	$	6.18		$	12.84
Class IS	$	9.68		$	10.78	$	6.18		$	12.82

See Combined Notes to Financial Statements.

80

EVERGREEN
Fixed Income Funds(formerly, Evergreen Select Fixed Income Funds)
Statements of Assets and Liabilities

September 30, 2001

	High Yield Bond Fund			Income Plus Fund			Intermediate Bond Fund			Limited Duration Fund
Assets
Identified cost of securities	$	151,596,866		$	1,524,746,283		$	550,254,876		$	345,917,571
Net unrealized gains or losses on securities		(4,776,735	)		43,464,917			22,176,674			10,004,629
Market value of securities		146,820,131			1,568,211,200			572,431,550			355,922,200
Cash		0			0			0			69,479
Receivable for securities sold		2,295,015			7,953,418			5,733,480			0
Principal paydown receivable		0			0			0			23,754
Receivable for Fund shares sold		0			273,976			35,000			1,334,968
Interest and dividends receivable		4,164,396			14,003,193			10,086,528			4,634,088
Receivable from investment advisor		0			10,131			3,612			16,894
Prepaid expenses and other assets		50,909			148,301			84,692			21,989
Total assets		153,330,451			1,590,600,219			588,374,862			362,023,372
Liabilities
Distributions payable		650,845			5,839,082			2,135,709			1,124,453
Payable for securities purchased		0			110,525,287			0			0
Payable for Fund shares redeemed		0			836,172			317,580			218,132
Advisory fee payable		4,197			0			0			0
Distribution Plan expenses payable		0			490			192			541
Due to other related parties		1,251			12,106			4,807			2,927
Accrued expenses and other liabilities		39,844			145,875			134,145			40,338
Total liabilities		696,137			117,359,012			2,592,433			1,386,391
Net assets	$	152,634,314		$	1,473,241,207		$	585,782,429		$	360,636,981
Net assets represented by
Paid-in capital	$	164,590,256		$	1,440,383,735		$	591,091,847		$	351,700,410
Overdistributed net investment income		(599,442	)		(4,822,835	)		(96,438	)		(977,701	)
Accumulated net realized losses on securities		(6,579,765	)		(5,784,610	)		(27,389,654	)		(90,357	)
Net unrealized gains or losses on securities		(4,776,735	)		43,464,917			22,176,674			10,004,629
Total net assets	$	152,634,314		$	1,473,241,207		$	585,782,429		$	360,636,981
Net assets consists of
Class I		152,633,347			1,449,336,864			576,388,315			331,218,735
Class IS		967			23,904,343			9,394,114			29,418,246
Total net assets	$	152,634,314		$	1,473,241,207		$	585,782,429		$	360,636,981
Shares outstanding
Class I		17,199,478			256,652,222			9,285,351			31,403,684
Class IS		109			4,232,937			151,333			2,789,263
Net asset value per share
Class I	$	8.87		$	5.65		$	62.08		$	10.55
Class IS	$	8.87		$	5.65		$	62.08		$	10.55

See Combined Notes to Financial Statements.

81

EVERGREEN
Fixed Income Funds(formerly, Evergreen Select Fixed Income Funds)
Statements of Operations

Year Ended September 30, 2001

		Adjustable Rate Fund			Core Bond Fund			Fixed Income Fund			Fixed Income Fund II
Investment income
Interest Income (net of foreign witholdings taxes of $0, $0, $1,387        and $0, respectively)		$	16,368,597		$	89,259,689		$	35,053,866		$	3,637,892
Dividends			0			3,006,312			0			0
Total investment income			16,368,597			92,266,001			35,053,866			3,637,892
Expenses
Advisory fee			547,685			4,635,086			2,261,934			0
Distribution Plan expenses			1,277,240			167,201			33,930			4
Administrative services fees			260,802			1,448,464			538,556			0
Transfer agent fee			162,515			79,788			26,991			7,924
Trustees’ fees and expenses			5,907			27,071			10,352			1,303
Printing and postage expenses			27,001			41,491			17,747			1,702
Custodian fee			68,647			438,522			160,956			11,192
Registration and filing fees			72,271			42,405			23,817			14,798
Professional fees			16,120			25,929			17,934			18,443
Other			115,611			63,707			34,788			22,738
Total expenses			2,553,799			6,969,664			3,127,005			78,104
Less:	Expense reductions		(6,499	)		(59,219	)		(26,471	)		(4,092	)
	Fee waivers		0			(605,138	)		(96,088	)		0
Net expenses			2,547,300			6,305,307			3,004,446			74,012
Net investment income			13,821,297			85,960,694			32,049,420			3,563,880
Net realized and unrealized gains or losses on securities
Net realized gains or losses on securities			(763,824	)		46,349,521			14,390,864			1,909,707
Net change in unrealized gains or losses on securities			8,102,039			50,724,824			16,784,350			1,033,726
Net realized and unrealized gains on securities			7,338,215			97,074,345			31,175,214			2,943,433
Net increase in net assets resulting from operations		$	21,159,512		$	183,035,039		$	63,224,634		$	6,507,313

See Combined Notes to Financial Statements.

82

EVERGREEN
Fixed Income Funds(formerly, Evergreen Select Fixed Income Funds)
Statements of Operations

Year Ended September 30, 2001

		High Yield Bond Fund			Income Plus Fund			Intermediate Bond Fund			Limited Duration Fund
Investment income
Interest Income		$	11,490,156		$	101,159,730		$	33,922,176		$	19,742,731
Dividends			90,000			210,000			0			0
Total investment income			11,580,156			101,369,730			33,922,176			19,742,731
Expenses
Advisory fee			633,423			6,441,534			3,100,966			686,887
Distribution Plan expenses			4			48,452			19,606			58,188
Administrative services fees			126,685			1,533,699			596,340			312,221
Transfer agent fee			1,148			33,148			15,975			29,807
Trustees’ fees and expenses			3,000			30,049			14,981			5,034
Printing and postage expenses			5,735			37,605			21,224			6,384
Custodian fee			25,466			470,054			147,945			72,716
Registration and filing fees			45,793			28,601			23,771			5,577
Professional fees			19,823			28,970			17,038			15,930
Other			36,571			90,470			104,824			2,186
Total expenses			897,648			8,742,582			4,062,670			1,194,930
Less:	Expense reductions		(14,967	)		(69,892	)		(21,206	)		(14,241	)
	Fee waivers		(100,421	)		(752,748	)		(324,552	)		(288,090	)
Net expenses			782,260			7,919,942			3,716,912			892,599
Net investment income			10,797,896			93,449,788			30,205,264			18,850,132
Net realized and unrealized gains or losses on securities
Net realized gains or losses on securities			(5,466,966	)		21,873,316			(1,771,462	)		2,677,863
Net change in unrealized gains or losses on securities			(3,602,633	)		60,032,540			17,859,289			9,925,011
Net realized and unrealized gains or losses on securities			(9,069,599	)		81,905,856			16,087,827			12,602,874
Net increase in net assets resulting from operations		$	1,728,297		$	175,355,644		$	46,293,091		$	31,453,006

See Combined Notes to Financial Statements.

83

EVERGREEN
Fixed Income Funds(formerly, Evergreen Select Fixed Income Funds)
Statements of Changes in Net Assets

Year Ended September 30, 2001

	Adjustable Rate Fund			Core Bond Fund			Fixed Income Fund			Fixed Income Fund II
Operations
Net investment income	$	13,821,297		$	85,960,694		$	32,049,420		$	3,563,880
Net realized gains or losses on securities		(763,824	)		46,349,521			14,390,864			1,909,707
Net change in unrealized gains or losses on securities		8,102,039			50,724,824			16,784,350			1,033,726
Net increase in net assets resulting from operations		21,159,512			183,035,039			63,224,634			6,507,313
Distributions to shareholders from
Net investment income
Class A		(4,665,749	)		(925,203	)		0			0
Class B		(2,180,693	)		(158,750	)		0			0
Class C		(3,263,649	)		(122,421	)		0			0
Class I		(3,155,617	)		(84,186,313	)		(31,346,610	)		(3,552,442	)
Class IS		(2,127,664	)		(1,262,090	)		(777,022	)		(73	)
Total distributions to shareholders		(15,393,372	)		(86,654,777	)		(32,123,632	)		(3,552,515	)
Capital share transactions
Proceeds from shares sold		934,222,306			620,261,698			87,386,210			2,368,725
Net asset value of shares issued in reinvestment of distributions		10,221,315			25,175,061			5,373,221			3,141,001
Payment for shares redeemed		(93,528,788	)		(331,183,125	)		(163,608,777	)		(24,134,179	)
Net increase (decrease) in net assets resulting from capital share
transactions		850,914,833			314,253,634			(70,849,346	)		(18,624,453	)
Total increase (decrease) in net assets		856,680,973			410,633,896			(39,748,344	)		(15,669,655	)
Net assets
Beginning of period		88,488,612			1,305,342,743			567,140,646			60,730,401
End of period	$	945,169,585		$	1,715,976,639		$	527,392,302		$	45,060,746
Undistributed (overdistributed) net investment income	$	(1,049,563	)	$	332,118		$	(1,740,879	)	$	(373,643	)

See Combined Notes to Financial Statements.

84

EVERGREEN
Fixed Income Funds(formerly, Evergreen Select Fixed Income Funds)
Statements of Changes in Net Assets

Year Ended September 30, 2001

	High Yield Bond Fund			Income Plus Fund			Intermediate Bond Fund			Limited Duration Fund
Operations
Net investment income	$	10,797,896		$	93,449,788		$	30,205,264		$	18,850,132
Net realized gains or losses on securities		(5,466,966	)		21,873,316			(1,771,462	)		2,677,863
Net change in unrealized gains or losses on securities		(3,602,633	)		60,032,540			17,859,289			9,925,011
Net increase in net assets resulting from operations		1,728,297			175,355,644			46,293,091			31,453,006
Distributions to shareholders from
Net investment income
Class I		(11,432,570	)		(94,788,299	)		(29,859,411	)		(18,604,181	)
Class IS		(90	)		(1,158,595	)		(379,376	)		(1,433,633	)
Total distributions to shareholders		(11,432,660	)		(95,946,894	)		(30,238,787	)		(20,037,814	)
Capital share transactions
Proceeds from shares sold		92,616,407			149,141,025			71,910,196			181,510,781
Net asset value of shares issued in reinvestment of distributions		2,777,402			2,938,146			262,042			4,954,800
Payment for shares redeemed		(8,260,010	)		(343,350,506	)		(121,483,299	)		(129,219,197	)
Net increase (decrease) in net assets resulting from capital share
transactions		87,133,799			(191,271,335	)		(49,311,061	)		57,246,384
Total increase (decrease) in net assets		77,429,436			(111,862,585	)		(33,256,757	)		68,661,576
Net assets
Beginning of period		75,204,878			1,585,103,792			619,039,186			291,975,405
End of period	$	152,634,314		$	1,473,241,207		$	585,782,429		$	360,636,981
Overdistributed net investment income	$	(599,442	)	$	(4,822,835	)	$	(96,438	)	$	(977,701	)

See Combined Notes to Financial Statements.

85

EVERGREEN
Fixed Income Funds(formerly, Evergreen Select Fixed Income Funds)
Statements of Changes in Net Assets

Year Ended September 30, 2000

	Adjustable Rate Fund			Core Bond Fund			Fixed Income Fund			Fixed Income Fund II (a)
Operations
Net investment income	$	3,427,505		$	72,682,068		$	37,716,945		$	4,275,388
Net realized losses on securities, futures contracts and       foreign currency related transactions		(422,614	)		(8,547,053	)		(4,947,953	)		(1,311,827	)
Net change in unrealized gains or losses on securities       foreign currency related transactions		151,300			11,534,883			5,611,973			811,905
Net increase in net assets resulting from operations		3,156,191			75,669,898			38,380,965			3,775,466
Distributions to shareholders from
Net investment income
Class A		(332,496	)		0			0			0
Class B		(56,567	)		0			0			0
Class C		(40,437	)		0			0			0
Class I		(1,909,189	)		(70,628,747	)		(36,587,102	)		(4,916,694	)
Class IS		(1,056,751	)		(792,815	)		(775,585	)		(75	)
Total distributions to shareholders		(3,395,440	)		(71,421,562	)		(37,362,687	)		(4,916,769	)
Capital share transactions    Proceeds from shares sold		43,719,459			447,495,756			174,151,758			4,745,981
Net asset value of shares issued in reinvestment of       distributions		2,886,165			15,585,947			7,162,763			4,409,590
Payment for shares redeemed		(50,437,311	)		(210,511,925	)		(217,709,595	)		(24,725,140	)
Net asset value of shares issued in acquisition		36,327,117			0			0			0
Net increase (decrease) in net assets resulting from       capital share transactions		32,495,430			252,569,778			(36,395,074	)		(15,569,569	)
Total increase (decrease) in net assets		32,256,181			256,818,114			(35,376,796	)		(16,710,872	)
Net assets    Beginning of period		56,232,431			1,048,524,629			602,517,442			77,441,273
End of period	$	88,488,612		$	1,305,342,743		$	567,140,646		$	60,730,401
Undistributed (overdistributed) net investment income	$	32,989		$	1,026,179		$	(1,517,986	)	$	(493,774	)
(a)   For the eleven months ended September 30, 2000. The Fund changed its fiscal year end from October 31 to September 30, effective September 30, 2000.

See Combined Notes to Financial Statements.

86

EVERGREEN
Fixed Income Funds(formerly, Evergreen Select Fixed Income Funds)
Statements of Changes in Net Assets

Year Ended September 30, 2000

	High Yield Bond Fund (a)			Income Plus Fund			Intermediate Bond Fund			Limited Duration Fund
Operations
Net investment income	$	3,789,188		$	112,396,540		$	32,651,623		$	19,391,528
Net realized losses on securities, futures contracts and foreign       currency related transactions		(1,178,799	)		(20,073,609	)		(22,167,026	)		(2,656,157	)
Net change in unrealized gains or losses on securities and foreign       currency related transactions		(1,174,102	)		629,335			11,571,853			1,493,616
Net increase in net assets resulting from operations		1,436,287			92,952,266			22,056,450			18,228,987
Distributions to shareholders from
Net investment income
Class I		(3,687,796	)		(110,332,973	)		(32,388,002	)		(18,705,422	)
Class IS		(70	)		(940,879	)		(338,792	)		(493,016	)
Total distributions to shareholders		(3,687,866	)		(111,273,852	)		(32,726,794	)		(19,198,438	)
Capital share transactions    Proceeds from shares sold		77,731,803			226,814,913			118,334,611			88,032,335
Net asset value of shares issued in reinvestment of distributions		74,654			5,937,883			312,502			3,432,056
Payment for shares redeemed		(350,000	)		(434,407,327	)		(199,273,680	)		(112,305,275	)
Net increase (decrease) in net assets resulting from capital share          transactions		77,456,457			(201,654,531	)		(80,626,567	)		(20,840,884	)
Total increase (decrease) in net assets		75,204,878			(219,976,117	)		(91,296,911	)		(21,810,335	)
Net assets
Beginning of period		0			1,805,079,909			710,336,097			313,785,740
End of period	$	75,204,878		$	1,585,103,792		$	619,039,186		$	291,975,405
Undistributed (overdistributed) net investment income	$	95,322		$	(349,786	)	$	(62,915	)	$	210,525
(a)  For the period from November 30, 1999 (commencement of operations) through September 30, 2000.

See Combined Notes to Financial Statements.

87

EVERGREEN
Fixed Income Funds(formerly, Evergreen Select Fixed Income Funds)
Statements of Changes in Net Assets

Year Ended October 31, 1999

	Fixed Income Fund II
Operations
Net investment income	$	5,058,629
Net realized losses on securities and futures contracts		(2,172,496	)
Net change in unrealized gains or losses on securities and futures contracts		(2,191,118	)
Net increase in net assets resulting from operations		695,015
Distributions to shareholders from
Net investment income
Class I (a)		(5,016,287	)
Class IS		0
Net realized gains
Class I (a)		(798,581	)
Class IS		0
Total distributions to shareholders		(5,814,868	)
Capital share transactions
Proceeds from shares sold		15,646,360
Net asset value of shares issued in reinvestment of distributions		4,156,912
Payment for shares redeemed		(20,614,478	)
Net decrease in net assets resulting from capital share transactions		(811,206	)
Total decrease in net assets		(5,931,059	)
Net assets
Beginning of period		83,372,332
End of period	$	77,441,273
Undistributed net investment income	$	222,341

(a)   Effective October 18, 1999 shareholders of Mentor Fixed Income Portfolio became owners of that number of full and fractional shares of Class I of Evergreen Fixed Income Fund II.

See Combined Notes to Financial Statements.

88

Combined Notes to Financial Statements

1. ORGANIZATION

The Evergreen Fixed Income Funds (formerly, Evergreen Select Fixed Income Funds) consist of the following funds (collectively the “Funds”):

Current Name	Former Name
Evergreen Adjustable Rate Fund (“Adjustable Rate Fund”)	Evergreen Select Adjustable Rate Fund
Evergreen Core Bond Fund (“Core Bond Fund”)	Evergreen Select Core Bond Fund
Evergreen Fixed Income Fund (“Fixed Income Fund”)	Evergreen Select Fixed Income Fund
Evergreen Fixed Income Fund II (“Fixed Income Fund II”)	Evergreen Select Fixed Income Fund II
Evergreen Select High Yield Bond Fund      (“High Yield Bond Fund”)
Evergreen Income Plus Fund (“Income Plus Fund”)	Evergreen Select Income Plus Fund
Evergreen Intermediate Term Municipal Bond Fund      (“Intermediate Bond Fund”)	Evergreen Select Intermediate Term Municipal      Bond Fund
Evergreen Limited Duration Fund      (“Limited Duration Fund”)	Evergreen Select Limited Duration Fund

Each Fund is a diversified series of Evergreen Select Fixed Income Trust (the “Trust”), a Delaware business trust organized on September 18, 1997. The Trust is an open-end management investment company registered under the Investment Company Act of 1940, as amended (the “1940 Act”).

The Funds offer Institutional (“Class I”) and Institutional Service (“Class IS”) classes of shares. In addition, Adjustable Rate Fund and Core Bond Fund offer Class A, Class B and Class C shares. Class A shares are sold with a front-end sales charge. Class B and Class C shares are sold without a front-end sales charge, but pay a higher ongoing distribution fee than Class A and are sold subject to a contingent deferred sales charge that is payable upon redemption and decreases depending on how long the shares have been held. Class I and Class IS shares are sold without a front-end sales charge or contingent deferred sales charge; however, Class IS shares pay an ongoing distribution fee.

2. SIGNIFICANT ACCOUNTING POLICIES

The following is a summary of significant accounting policies consistently followed by the Funds in the preparation of their financial statements. The policies are in conformity with generally accepted accounting principles, which require management to make estimates and assumptions that affect amounts reported herein. Actual results could differ from these estimates.

A. Valuation of Investments

Portfolio debt securities acquired with more than 60 days to maturity are valued at prices obtained from an independent pricing service which takes into consideration such factors as similar security prices, yields, maturities, liquidity and ratings. Securities for which valuations are not available from an independent pricing service may be valued by brokers which use prices provided by market makers or estimates of market value obtained from yield data relating to investments or securities with similar characteristics.

Listed equity securities are valued at the last sale price reported on the national securities exchange, where the securities are principally traded.

Short-term securities with remaining maturities of 60 days or less at the time of purchase are valued at amortized cost, which approximates market value.

Investments in other mutual funds are valued at net asset value. Securities for which market quotations are not available are valued at fair value as determined in good faith, according to procedures approved by the Board of Trustees.

89

Combined Notes to Financial Statements (continued)  

B. When-issued and Delayed Delivery Transactions

The Funds record when-issued securities no later than one business day after the trade date and maintain security positions such that sufficient liquid assets will be available to make payment for the securities purchased. Securities purchased on a when-issued or delayed delivery basis are marked-to-market daily and begin earning interest on the settlement date. Losses may occur on these transactions due to changes in market conditions or the failure of counterparties to perform under the contract.

C. Securities Lending

The Funds may lend their securities to certain qualified brokers in order to earn additional income. The Funds receive compensation in the form of fees or interest earned on the investment of any cash collateral received. The Funds receive collateral in the form of cash or securities with a market value at least equal to the market value of the securities on loan, including accrued interest. In the event of default or bankruptcy by the borrower, the Funds could experience delays and costs in recovering the loaned securities or in gaining access to the collateral.

D. Dollar Roll Transactions

Each Fund may enter into dollar roll transactions with respect to mortgage backed securities. In a dollar roll transaction, the Fund sells mortgage backed securities to financial institutions and simultaneously agrees to accept substantially similar (same type, coupon and maturity) securities at a later date at an agreed upon price. Dollar roll transactions are treated as short-term financing arrangements which will not exceed 12 months. The Funds will use the proceeds generated from the transactions to invest in short-term investments, which may enhance a Fund’s current yield and total return.

E. Security Transactions and Investment Income

Security transactions are recorded no later than one business day after the trade date. Realized gains and losses are computed using the specific cost of the security sold. Interest income is recorded on the accrual basis and includes accretion of discounts and amortization of premiums relating to fixed income securities held by the Fund. Dividend income is recorded on the ex-dividend date or in the case of some foreign securities, on the date when the Fund is made aware of the dividend. Foreign income and capital gains realized on some securities may be subject to foreign taxes, which are accrued as applicable.

F. Federal Taxes

Each Fund intends to continue to qualify as a regulated investment company and distribute all of its taxable and tax-exempt income, including any net capital gains (which have already been offset by available capital loss carryovers). Accordingly, no provision for federal taxes is required.

G. Distributions

Distributions to shareholders from net investment income for each Fund (except Fixed Income Fund II) are accrued daily and paid monthly. Distributions from net investment income for Fixed Income Fund II are declared and paid quarterly. Distributions from net realized gains are recorded on the ex-dividend date. Such distributions are determined in conformity with income tax regulations, which may differ from generally accepted accounting principles.

Reclassifications have been made to the Funds’ components of net assets to reflect income and gains available for distribution (or available capital loss carryovers, as applicable) under income tax regulations. The primary permanent differences causing such reclassifications are due to certain capital loss carryovers assumed as a result of acquisitions, expiration of capital loss carryovers, differing treatment of mortgage dollar rolls, distributions in excess of net investment income, and reclassification of distributions.

H. Class Allocations

Income, common expenses and realized and unrealized gains and losses are allocated to the classes based on the relative net assets of each class. Distribution and service fees, if any, are calculated daily at the class level based on the appropriate net assets of each class and the specific expense rates applicable to each class.

90

Combined Notes to Financial Statements (continued)  

3. ADVISORY FEES AND OTHER TRANSACTIONS WITH AFFILIATES

During the year ended September 30, 2001, the investment advisory contracts of the Funds were transferred amongst wholly owned subsidiaries controlled by Wachovia Corporation (formerly, First Union Corporation). The current advisor for each Fund is Evergreen Investment Management Company, LLC (“EIMC”), an indirect wholly owned subsidiary of Wachovia Corporation. Under Securities and Exchange Commission rules and no-action letters, shareholder approval was not required because the portfolio managers of the Funds and the advisory fees paid by the Funds did not change during the transfers.

EIMC is the investment advisor to the Funds and is paid an advisory fee that is calculated and paid daily. The advisory fee is computed by applying percentage rates to the Fund’s average daily net assets as identified below:

	Advisory Fee Rate
Adjustable Rate Fund	0.21%
Core Bond Fund	0.32%
Fixed Income Fund	0.42%
Fixed Income Fund II	0.00%
High Yield Bond Fund	0.50%
Income Plus Fund	0.42%
Intermediate Bond Fund	0.52%
Limited Duration Fund	0.22%

During the year ended September 30, 2001 the amount of investment advisory fees waived by the investment advisor and the impact on each Fund’s annualized expense ratio represented as a percentage of its average daily net assets were as follows:

	Fees Waived		% of Average Daily Net Assets
Adjustable Rate Fund	$	0	0.00%
Core Bond Fund		605,138	0.04%
Fixed Income Fund		96,088	0.02%
Fixed Income Fund II		0	0.00%
High Yield Bond Fund		100,421	0.08%
Income Plus Fund		752,748	0.05%
Intermediate Bond Fund		324,552	0.05%
Limited Duration Fund		288,090	0.09%

Effective on May 11, 2001, Tattersall Advisory Group (“TAG”), a wholly owned subsidiary of Wachovia Corporation, became the investment sub-advisor for Fixed Income Fund, Fixed Income Fund II and Income Plus Fund. TAG is paid for its services by EIMC.

Evergreen Investment Services, Inc. (“EIS”), an indirect, wholly owned subsidiary of Wachovia Corporation, is the administrator to the Funds. As administrator, EIS provides the Funds with facilities, equipment and personnel. Each Fund, except Fixed Income Fund II, pays an administrative fee of 0.10% of each Fund’s average daily net assets. EIS receives no compensation from Fixed Income Fund II for its services.

Evergreen Service Company, LLC (“ESC”), an indirect, wholly owned subsidiary of Wachovia Corporation, is the transfer and dividend disbursing agent for the Funds.

Officers of the Funds and affiliated Trustees receive no compensation directly from the Funds.

4. DISTRIBUTION PLANS

Evergreen Distributor, Inc. (“EDI”), a wholly owned subsidiary of BISYS Fund Services, Inc., serves as principal underwriter to the Funds.

91

Combined Notes to Financial Statements (continued)

Each Fund has adopted Distribution Plans, as allowed by Rule 12b-1 of the 1940 Act, for Class IS shares. Adjustable Rate Fund and Core Bond Fund have also adopted Distribution Plans for their Class A, Class B and Class C shares. Distribution plans permit a Fund to compensate its principal underwriter for costs related to selling shares of the Fund and for various other specified services. These costs consist primarily of commissions and service fees to broker-dealers who sell shares of the Fund. Under the Distribution Plans, each class incurs distribution fees at the following annual rates:

	Average Daily Net Assets
Class A	0.25%
Class B	1.00
Class C	1.00
Class IS	0.25

Of the above amounts, each share class may pay under its Distribution Plan a maximum service fee of 0.25% of the average daily net assets of the class to pay for shareholder service fees. Distribution Plan expenses are calculated and paid daily.

During the year ended September 30, 2001 amounts paid or accrued to EDI pursuant to each Fund’s Class A, Class B, Class C and Class IS Distribution Plans were as follows:

	Class A		Class B		Class C		Class IS
Adjustable Rate Fund	$	146,570	$	410,921	$	635,608	$	84,141
Core Bond Fund		45,868		37,362		29,160		54,811
Fixed Income Fund		n/a		n/a		n/a		33,930
Fixed Income Fund II		n/a		n/a		n/a		4
High Yield Bond Fund		n/a		n/a		n/a		4
Income Plus Fund		n/a		n/a		n/a		48,452
Intermediate Bond Fund		n/a		n/a		n/a		19,606
Limited Duration Fund		n/a		n/a		n/a		58,188

With respect to Class B and Class C shares, the principal underwriter may pay distribution fees greater than the allowable annual amounts each Fund is permitted to pay under the Distribution Plans.

Each of the Distribution Plans may be terminated at any time by vote of the independent Trustees or by vote of a majority of the outstanding voting shares of the respective class.

5. ACQUISITION

Effective on the close of business on July 21, 2000, Adjustable Rate Fund acquired substantially all the assets and assumed certain liabilities of Evergreen Capital Preservation and Income Fund, an open-end management investment company registered under the 1940 Act, through a tax-free exchange for 2,864,628 Class A shares, 553,117 Class B shares and 393,719 Class C shares of Adjustable Rate Fund. The acquired net assets consisted primarily of portfolio securities with unrealized depreciation of $236,471. The aggregate net assets of Adjustable Rate Fund and Evergreen Capital Preservation and Income Fund immediately prior to the acquisition were $46,395,424 and $36,327,117, respectively. The aggregate net assets of Adjustable Rate Fund immediately after the acquisition were $82,722,541.

92

Combined Notes to Financial Statements (continued)

6. CAPITAL SHARE TRANSACTIONS

The Funds have an unlimited number of shares of beneficial interest with $0.001 par value authorized. Shares of beneficial interest of the Funds are currently divided into Class I and Class IS, as well as Class A, Class B, and Class C for Adjustable Rate Fund and Core Bond Fund. Transactions in shares of the Funds were as follows:

ADJUSTABLE RATE FUND

	Year Ended September 30,
	2001					2000
	Shares		Amount			Shares		Amount
Class A (a)
Shares sold	22,408,204		$	215,481,681		73,667		$	700,007
Automatic conversion of Class B shares to     Class A shares	52,847			505,477		0			0
Shares issued in reinvestment of distributions	289,831			2,787,349		22,701			215,914
Shares issued in acquisition of Evergreen     Capital Preservation and Income Fund	0			0		2,864,628			27,303,067
Shares redeemed	(5,902,234	)		(56,736,480	)	(173,059	)		(1,646,963	)
Net increase	16,848,648			162,038,027		2,787,937			26,572,025
Class B (a)
Shares sold	17,847,951			171,817,578		6,546			62,309
Automatic conversion of Class B shares to     Class A shares	(52,801	)		(505,477	)	0			0
Shares issued in reinvestment of distributions	148,650			1,432,020		3,909			37,177
Shares issued in acquisition of Evergreen     Capital Preservation and Income Fund	0			0		553,117			5,271,655
Shares redeemed	(572,247	)		(5,501,854	)	(31,545	)		(300,108	)
Net increase	17,371,553			167,242,267		532,027			5,071,033
Class C (a)
Shares sold	36,141,650			348,096,267		23,872			226,782
Shares issued in reinvestment of distributions	234,402			2,260,622		2,299			21,862
Shares issued in acquisition of Evergreen     Capital Preservation and Income Fund	0			0		393,719			3,752,395
Shares redeemed	(808,168	)		(7,771,330	)	(31,516	)		(299,574	)
Net increase	35,567,884			342,585,559		388,374			3,701,465
Class I
Shares sold	11,090,339			106,899,022		1,026,242			9,957,317
Shares issued in reinvestment of distributions	237,115			2,277,454		203,359			1,761,786
Shares redeemed	(203,314	)		(1,943,769	)	(1,555,676	)		(14,823,916	)
Net increase (decrease)	11,124,140			107,232,707		(326,075	)		(3,104,813	)
Class IS
Shares sold	9,566,951			91,927,758		3,440,789			32,773,044
Shares issued in reinvestment of distributions	152,380			1,463,870		89,156			849,426
Shares redeemed	(2,265,316	)		(21,575,355	)	(3,502,235	)		(33,366,750	)
Net increase	7,454,015			71,816,273		27,710			255,720
Net Increase			$	850,914,833				$	32,495,430
(a) For the period from June 30, 2000 (commencement of class operations) to September 30, 2000.

CORE BOND FUND

	Year Ended September 30, 2001
	Shares			Amount
Class A (b)
Shares sold	9,226,035		$	97,495,860
Shares issued in reinvestment of distributions	63,019			675,347
Shares redeemed	(156,409	)		(1,670,944	)
Net increase	9,132,645			96,500,263
Class B (b)
Shares sold	3,746,699			39,964,795
Shares issued in reinvestment of distributions	11,096			119,110
Shares redeemed	(39,004	)		(416,656	)
Net increase	3,718,791			39,667,249
Class C (b)
Shares sold	2,295,722			24,421,968
Shares issued in reinvestment of distributions	7,098			76,208
Shares redeemed	(11,360	)		(121,555	)
Net increase	2,291,460		$	24,376,621
(b) For the period from May 11, 2001 (commencement of class operations) to September 30, 2001.

93

Combined Notes to Financial Statements (continued)

CORE BOND FUND (continued)

	Year Ended September 30,
	2001					2000
	Shares		Amount			Shares		Amount
Class I
Shares sold	42,500,694		$	443,472,945		41,868,670		$	417,398,564
Shares issued in reinvestment of     distributions	2,242,944			23,499,104		1,515,762			15,104,053
Shares redeemed	(29,677,837	)		(310,262,125	)	(19,749,904	)		(196,203,342	)
Net increase	15,065,801			156,709,924		23,634,528			236,299,275
Class IS
Shares sold	1,424,087			14,906,130		3,016,834			30,097,192
Shares issued in reinvestment of     distributions	76,808			805,292		48,441			481,894
Shares redeemed	(1,803,463	)		(18,711,845	)	(1,434,674	)		(14,308,583	)
Net increase (decrease)	(302,568	)		(3,000,423	)	1,630,601			16,270,503
Net increase			$	314,253,634				$	252,569,778

FIXED INCOME FUND

	Year Ended September 30,
	2001					2000
	Shares		Amount			Shares		Amount
Class I
Shares sold	13,315,974		$	80,087,258		28,042,018		$	161,285,403
Shares issued in reinvestment of     distributions	820,893			4,924,986		1,157,484			6,664,297
Shares redeemed	(26,141,932	)		(156,537,646	)	(35,697,696	)		(205,418,401	)
Net decrease	(12,005,065	)		(71,525,402	)	(6,498,194	)		(37,468,701	)
Class IS
Shares sold	1,216,253			7,298,952		2,234,345			12,866,355
Shares issued in reinvestment of     distributions	74,664			448,235		86,592			498,466
Shares redeemed	(1,177,888	)		(7,071,131	)	(2,133,909	)		(12,291,194	)
Net increase	113,029			676,056		187,028			1,073,627
Net decrease				($70,849,346	)				($36,395,074	)

FIXED INCOME FUND II

	Year Ended September 30,										Year Ended October 31, 1999 (b)
	2001					2000 (a)
	Shares		Amount			Shares		Amount			Shares		Amount
Class I (c)
Shares sold	187,575		$	2,368,725		387,259		$	4,745,981		1,220,609		$	15,645,360
Shares issued in reinvestment     of distributions	249,676			3,141,001		363,849			4,409,515		327,679			4,156,912
Shares redeemed	(1,914,615	)		(24,134,179	)	(2,021,519	)		(24,725,140	)	(1,634,506	)		(20,614,478	)
Net decrease	(1,477,364	)		(18,624,453	)	(1,270,411	)		(15,569,644	)	(86,218	)		(812,206	)
Class IS
Shares sold	0			0		0			0		82			1,000
Shares issued in reinvestment     of distributions	0			0		6			75		0			0
Shares redeemed	0			0		0			0		0			0
Net increase	0			0		6			75		82			1,000
Net decrease				($18,624,453	)				($15,569,569	)			$	(811,206	)

(a)	For the eleven months ended September 30, 2000. The Fund changed its fiscal year end from October 31 to September 30, effective September 30, 2000.
(b)	For Class IS, for the period from October 18, 1999 (commencement of class operations) to October 31, 1999.
(c)	Effective October 18, 1999, shareholders of Mentor Fixed Income Portfolio became owners of that number of full and fractional shares of Class I of Evergreen Fixed Income Fund II.

94

Combined Notes to Financial Statements (continued)

HIGH YIELD BOND FUND

	Year Ended September 30,
	2001					2000 (a)
	Shares		Amount			Shares		Amount
Class I
Shares sold	9,917,074		$	92,616,407		7,889,907		$	77,730,803
Shares issued in reinvestment of     distributions	299,234			2,777,386		7,685			74,584
Shares redeemed	(877,888	)		(8,260,010	)	(36,534	)		(350,000	)
Net increase	9,338,420			87,133,783		7,861,058			77,455,387
Class IS
Shares sold	0			0		100			1,000
Shares issued in reinvestment of     distributions	2			16		7			70
Shares redeemed	0			0		0			0
Net increase	2			16		107			1,070
Net increase			$	87,133,799				$	77,456,457
(a) For the period from November 30, 1999 (commencement of class operations) to September 30, 2000.

INCOME PLUS FUND

	Year Ended September 30,
	2001					2000
	Shares		Amount			Shares		Amount
Class I
Shares sold	22,793,624		$	124,871,513		37,646,502		$	200,329,489
Shares issued in reinvestment of     distributions	412,754			2,262,635		1,010,675			5,387,166
Shares redeemed	(59,148,106	)		(325,007,537	)	(77,546,544	)		(412,912,189	)
Net decrease	(35,941,728	)		(197,873,389	)	(38,889,367	)		(207,195,534	)
Class IS
Shares sold	4,415,026			24,269,512		4,969,183			26,485,424
Shares issued in reinvestment of     distributions	122,684			675,511		103,229			550,717
Shares redeemed	(3,341,882	)		(18,342,969	)	(4,043,770	)		(21,495,138	)
Net increase	1,195,828			6,602,054		1,028,642			5,541,003
Net decrease				($191,271,335	)				($201,654,531	)

INTERMEDIATE BOND FUND

	Year Ended September 30,
	2001					2000
	Shares		Amount			Shares		Amount
Class I
Shares sold	1,067,013		$	65,577,371		1,776,137		$	106,824,895
Shares issued in reinvestment of     distributions	943			58,014		2,045			122,985
Shares redeemed	(1,896,257	)		(116,378,187	)	(3,151,965	)		(189,521,923	)
Net decrease	(828,301	)		(50,742,802	)	(1,373,783	)		(82,574,043	)
Class IS
Shares sold	102,714			6,332,825		191,688			11,509,716
Shares issued in reinvestment of     distributions	3,311			204,028		3,155			189,517
Shares redeemed	(83,089	)		(5,105,112	)	(162,043	)		(9,751,757	)
Net increase	22,936			1,431,741		32,800			1,947,476
Net decrease				($49,311,061	)				($80,626,567	)

95

Combined Notes to Financial Statements (continued)

LIMITED DURATION FUND

	Year Ended September 30,
	2001					2000
	Shares		Amount			Shares		Amount
Class I
Shares sold	14,105,558		$	146,499,037		7,415,216		$	74,964,417
Shares issued in reinvestment of     distributions	402,976			4,175,845		305,052			3,087,295
Shares redeemed	(10,885,834	)		(112,789,790	)	(10,505,383	)		(106,377,843	)
Net increase (decrease)	3,622,700			37,885,092		(2,785,115	)		(28,326,131	)
Class IS
Shares sold	3,396,563			35,011,744		1,291,513			13,067,918
Shares issued in reinvestment of     distributions	74,995			778,955		34,139			344,761
Shares redeemed	(1,580,929	)		(16,429,407	)	(586,512	)		(5,927,432	)
Net increase	1,890,629			19,361,292		739,140			7,485,247
Net increase (decrease)			$	57,246,384					($20,840,884	)

7. SECURITIES TRANSACTIONS

Cost of purchases and proceeds from sales of investment securities (excluding short-term securities and mortgage dollar roll transactions) were as follows for the year ended September 30, 2001:

	Cost of Purchases				Proceeds from Sales
	U.S. Government		Non-U.S. Government		U.S. Government		Non-U.S. Government
Adjustable Rate Fund	$	851,404,284	$	0	$	34,305,455	$	0
Core Bond Fund		0		3,531,351,739		0		3,251,647,814
Fixed Income Fund		824,830,698		325,463,889		732,035,274		387,020,180
Fixed Income Fund II		73,031,581		27,799,007		85,733,382		29,017,115
High Yield Bond Fund		0		193,320,200		0		119,683,552
Income Plus Fund		2,147,049,025		671,365,058		2,067,253,648		1,051,513,040
Intermediate Bond Fund		0		222,659,995		0		281,475,015
Limited Duration Fund		182,524,683		249,581,087		211,903,313		151,785,150

During the year ended September 30, 2001 the Funds earned income from security lending as follows:

	Income Earned
Adjustable Rate Fund	$	18,444
Core Bond Fund		10,566
Fixed Income Fund		526,178
Limited Duration Fund		5,394

As of September 30, 2001, the Funds had no securities on loan.

During the year ended September 30, 2001, Core Bond Fund, Fixed Income Fund, Fixed Income Fund II and Income Plus Fund entered into dollar roll transactions.

During the year ended September 30, 2001, Fixed Income Fund, Fixed Income Fund II and Income Plus Fund earned income on dollar roll transactions as follows:

	Income Earned on Dollar Roll Transactions
Core Bond Fund	$	2,789
Fixed Income Fund		589,787
Fixed Income Fund II		48,320
Income Plus Fund		2,060,821

96

Combined Notes to Financial Statements (continued)

On September 30, 2001, the composition of unrealized appreciation and depreciation on securities based on the aggregate cost of securities for federal income tax purposes were as follows:

	Tax Cost		Gross Unrealized Appreciation		Gross Unrealized Depreciation			Net Unrealized Appreciation (Depreciation)
Adjustable Rate Fund	$	950,041,638	$	8,270,482	$	(607,476	)	$	7,663,006
Core Bond Fund		1,916,383,711		57,086,239		(1,498,448	)		55,587,791
Fixed Income Fund		544,971,413		13,104,611		(448,172	)		12,656,439
Fixed Income Fund II		46,804,954		1,124,208		(31,206	)		1,093,002
High Yield Bond Fund		151,618,613		1,150,672		(5,949,154	)		(4,798,482	)
Income Plus Fund		1,525,116,239		44,445,910		(1,350,949	)		43,094,961
Intermediate Bond Fund		550,254,876		27,146,512		(4,969,838	)		22,176,674
Limited Duration Fund		345,918,897		10,049,848		(46,545	)		10,003,303

At September 30, 2001, the Funds had capital loss carryovers for federal income tax purposes as follows:

	Expiration
	Total		2002	2003	2005	2006	2007	2008		2009
Adjustable Rate Fund	$	1,502,536	$253,605	$43,378	$34,064	$275,930	$281,543	$	187,870	$	426,146
Fixed Income Fund II		1,391,874	0	0	0	0	7,770		1,384,104		0
High Yield Bond Fund		1,682,951	0	0	0	0	0		0		1,682,951
Income Plus Fund		5,414,654	0	0	0	0	0		5,414,654		0
Intermediate Bond Fund		25,303,374	0	0	0	0	0		8,498,463		16,804,911
Limited Duration Fund		89,031	0	0	0	0	0		89,031		0

Adjustable Rate Fund’s capital loss carryforward was created as a result of the July 21, 2000 acquisition of substantially all of the assets and assumption of certain liabilities of the Evergreen Capital Preservation and Income Fund in exchange for Adjustable Rate Fund shares. In accordance with income tax regulations, certain Adjustable Rate Fund gains may not be used to offset this capital loss carryforward.

For income tax purposes, capital losses incurred after October 31 within a Fund’s fiscal year are deemed to arise on the first business day of the Fund’s following fiscal year. As of September 30, 2001 the Funds incurred and elected to defer post October losses as follows:

	Post October Losses
Adjustable Rate Fund	$	713,775
High Yield Bond Fund		4,875,067
Intermediate Bond Fund		2,086,280

8. IN-KIND TRANSACTION

On September 25, 2000, Evergreen Total Return Bond Fund (“Total Return Bond Fund”), a series of the Trust, executed a redemption in-kind transaction. This transaction liquidated the net assets of Total Return Bond Fund. In turn, on September 25, 2000, the assets from this transaction were transferred on a pro-rata basis to Core Bond Fund, High Yield Bond Fund and Evergreen International Bond Fund (formerly, Evergreen Select International Bond

97

Combined Notes to Financial Statements (continued)  

Fund) and into a separately managed account of Wachovia Corporation. In exchange for issuing the following amount of Class I shares, investment securities and cash were contributed to the Core Bond Fund, High Yield Bond Fund and Evergreen International Bond Fund to complete the transaction:

	Class I shares issued	Cost/Market Value of Securities		Cash
Core Bond Fund	1,738,187	$	15,934,494	$	1,255,682
High Yield Bond Fund	2,042,699		17,823,986		1,271,971
Evergreen International Bond Fund	2,921,288		21,144,211		1,682,290

The amount of shares issued by the Core Bond Fund, High Yield Bond Fund and Evergreen International Bond Fund are reflected in the proceeds from shares sold in each Fund’s Statement of Changes in Net Assets for the year ended September 30, 2000.

9. EXPENSE REDUCTIONS

Through expense offset arrangements with ESC and their custodian a portion of the fund expenses have been reduced. The amount of expense reductions received by each Fund and the impact of the total expense reductions on each Fund’s annualized expense ratio represented as a percentage of its average net assets were as follows:

	Total Expense Reductions		% of Average Net Assets
Adjustable Rate Fund	$	6,499	0.00%
Core Bond Fund		59,219	0.00%
Fixed Income Fund		26,471	0.00%
Fixed Income Fund II		4,092	0.01%
High Yield Bond Fund		14,967	0.01%
Income Plus Fund		69,892	0.00%
Intermediate Bond Fund		21,206	0.00%
Limited Duration Fund		14,241	0.00%

10. DEFERRED TRUSTEES’ FEES

Each independent Trustee of each Fund may defer any or all compensation related to performance of their duties as Trustees. The Trustees’ deferred balances are allocated to deferral accounts, which are included in the accrued expenses for the Fund. The investment performance of the deferral accounts are based on the investment performance of certain Evergreen Funds. Any gains earned or losses incurred in the deferral accounts are reported in the Fund’s Trustees’ fees and expenses. At the election of the Trustees, the deferral account will be paid either in one lump sum or in quarterly installments for up to ten years.

11. FINANCING AGREEMENT

The Fund and certain other Evergreen Funds share in a $725 million unsecured revolving credit commitment to temporarily finance the purchase or sale of securities for prompt delivery, including funding redemption of their shares, as permitted by each Fund’s borrowing restrictions. Borrowings under this facility bear interest at 0.50% per annum above the Federal Funds rate. All of the Funds are charged an annual commitment fee of 0.10% of the unused balance, which is allocated pro rata. For its assistance in arranging the financing agreement, First Union Securities, Inc. was paid a one-time arrangement fee of $150,000, which was charged to the Funds and also allocated pro rata.

During the year ended September 30, 2001, the Funds had no borrowings under this agreement.

98

Combined Notes to Financial Statements (continued)  

12. CONCENTRATION OF RISK

The Funds may invest a substantial portion of their assets in an industry or sector and, therefore, may be more affected by changes in that industry or sector than would be a comparable mutual fund that is not heavily weighted in any industry or sector.

13. NEW ACCOUNTING PRONOUNCEMENT

In November 2000, the AICPA issued a revised Audit and Accounting Guide, Audits of Investment Companies, which is effective for fiscal years beginning after December 15, 2000. Among other things, the revised Guide amends certain accounting practices and disclosures presently used, such as treatment of payments by affiliates, excess expense plan accounting, reporting by multiple-class funds, and certain financial statement disclosures. While some of the Guide’s requirements will not be effective until the SEC amends its disclosure and reporting requirements, other requirements are effective presently.

The revised Guide will require the Funds to amortize premium and accrete discount on all fixed-income securities and classify gains and losses realized on paydowns on mortgage-backed securities, which are presently included in realized gain/loss, as interest income. Adopting these accounting principles will not impact the total net assets of the Funds, but will change the classification of certain amounts between interest income and realized and unrealized gain/loss in the Statements of Operations and affect the presentation of the Funds’ Financial Highlights. The Funds have not at this time quantified the impact, if any, resulting from the adoption of these accounting changes on the financial statements.

99

Independent Auditors' Report  

The Board of Trustees and Shareholders
Evergreen Select Fixed Income Trust

We have audited the accompanying statements of assets and liabilities, including the schedules of investments of the Evergreen Adjustable Rate Fund, Evergreen Core Bond Fund, Evergreen Fixed Income Fund, Evergreen Fixed Income Fund II, Evergreen Select High Yield Bond Fund, Evergreen Income Plus Fund, Evergreen Intermediate Term Municipal Bond Fund, and Evergreen Limited Duration Fund, portfolios of the Evergreen Select Fixed Income Trust, as of September 30, 2001, and the related statements of operations for the year or period then ended, the statements of changes in net assets for each of the years or periods in the two-year period then ended, and the financial highlights for each of the years or periods in the five-year period then ended. These financial statements and financial highlights are the responsibility of the Funds’ management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.

We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform our audits to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of September 30, 2001 by correspondence with the custodian and brokers. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of the Evergreen Adjustable Rate Fund, Evergreen Core Bond Fund, Evergreen Fixed Income Fund, Evergreen Fixed Income Fund II, Evergreen Select High Yield Bond Fund, Evergreen Income Plus Fund, Evergreen Intermediate Term Municipal Bond Fund, and Evergreen Limited Duration Bond Fund as of September 30, 2001, the results of their operations, changes in their net assets and financial highlights for each of the years or periods described above in conformity with accounting principles generally accepted in the United States of America.

Boston, Massachusetts
November 2, 2001

100

Additional Information (unaudited)

FEDERAL TAX STATUS OF DISTRIBUTIONS

For corporate shareholders, the following percentages of ordinary income dividends paid during the year ended September 30, 2001, qualified for the dividends received deductions:

Core Bond Fund 3.34%

For the year ended September 30, 2001, the percentage representing the portion of dividends exempt from federal income tax, other than alternative minimum tax for the Intermediate Bond Fund is 99.31%.

101

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