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The Merger was consummated on April 30, As a result of the Merger it is expected that FUNB and its affiliates will succeed to the investment advisory and administrative functions currently performed for CoreFunds Equity Index by various units of CoreStates Financial and various unaffiliated parties.
It is also expected that CoreStates Financial and its subsidiaries will no longer, upon completion of the Reorganization and similar reorganizations of other portfolios of CoreFunds, Inc. Based on information received from CSIA and FUNB, at a meeting held on February 6, , all of the Directors present, including the non-interested Directors, considered and approved the Reorganization as in the best interests of shareholders of.
CoreFunds Equity Index and determined that the interests of existing shareholders of CoreFunds Equity Index will not be diluted as a result of the transactions contemplated by the Reorganization. As noted above, CoreStates Financial has merged with and into a wholly-owned subsidiary of First Union.
The Merger caused, as a matter of law, termination of the investment advisory agreement between each series of CoreFunds, Inc. In approving the Plan, the Directors reviewed various factors about the Funds and the proposed Reorganization. The Reorganization is part of an overall plan to combine the portfolios comprising CoreFunds, Inc.
Evergreen Equity Index and CoreFunds Equity Index have identical investment objectives and policies and comparable risk profiles. See "Comparison of Investment Objectives and Policies" below. The Directors also considered the benefits to be derived by shareholders of CoreFunds Equity Index from the sale of its assets to Evergreen Equity Index.
In addition, the Directors considered that there are alternatives available to shareholders of CoreFunds Equity Index, including the ability to redeem their shares, as well as the option to vote against the Reorganization. Section 15 f of the Act provides that when a change in the control of an investment adviser occurs, the investment adviser or any of its affiliated persons may receive any amount or benefit in connection therewith under certain conditions.
Another condition is that no "unfair burden" is imposed on the investment company as a result of the understandings applicable thereto. The term "unfair burden" is considered under the Act to include any arrangement during the two-year period after the transaction whereby the investment adviser or predecessor or successor adviser , or any "interested person" of any such adviser, receives or is entitled to receive any compensation, directly or indirectly, from the investment company or its security holders other than fees for bona fide investment advisory or other services or from any person in connection with the purchase or sale of securities or other property to, from or on behalf of the investment company other than fees for bona fide principal underwriting services.
During their consideration of the Reorganization the Directors met with Fund counsel regarding the legal issues involved. The Trustees of Evergreen Select Equity Trust also concluded at a meeting on February 11, that the proposed Reorganization would be in the best interests of shareholders of Evergreen Equity Index.
CoreStates Financial and First Union have agreed to take appropriate steps to insure that the cost of extending such coverage will not be borne by CoreFunds Equity Index's shareholders.
The following summary is qualified in its entirety by reference to the Plan Exhibit A hereto. Prior to the Closing Date, CoreFunds Equity Index will endeavor to discharge all of its known liabilities and obligations. Evergreen Equity Index will not assume any liabilities or obligations of CoreFunds Equity Index other than those reflected in an unaudited statement of assets and liabilities of CoreFunds Equity Index prepared as of the close of regular trading on the NYSE, currently 4: Eastern time, on the business day immediately prior to the Closing Date.
Shareholders of CoreFunds Index will receive the number of full and fractional shares of each class of Evergreen Equity Index equal to the number of shares of each corresponding class as they currently hold of CoreFunds Equity Index. Such computations will take place as of the close of regular trading on the NYSE on the business day immediately prior to the Closing Date.
The net asset value per share of each class will be determined by dividing assets, less liabilities, in each case attributable to the respective class, by the total number of outstanding shares.
The method of valuation employed will be consistent with the procedures set forth in the Prospectuses and Statement of Additional Information of Evergreen Equity Index, Rule 22c-1 under the Act, and with the interpretations of such Rule by the SEC's Division of Investment Management.
As soon after the Closing Date as conveniently practicable, CoreFunds Equity Index will liquidate and distribute pro rata to shareholders of record as of the close of business on the Closing Date the full and fractional shares of Evergreen Equity Index received by CoreFunds Equity Index. Such liquidation and distribution will be accomplished by the establishment of accounts in the names of the Fund's shareholders on Evergreen Equity Index's share records of its transfer agent.
All issued and outstanding shares of CoreFunds Equity Index, including those represented by certificates, will be canceled.
The shares of Evergreen Equity Index to be issued will have no preemptive or conversion rights. After these distributions and the winding up of its affairs, CoreFunds Equity Index will be terminated. In connection with such termination, CoreFunds, Inc. The consummation of the Reorganization is subject to the conditions set forth in the Plan, including approval by CoreFunds Equity Index's shareholders, accuracy of various representations and warranties and receipt of opinions of counsel, including opinions with respect to those matters referred to in "Federal Income Tax Consequences" below.
Notwithstanding approval of CoreFunds Equity Index's shareholders, the Plan may be terminated a by the mutual agreement of CoreFunds Equity Index and Evergreen Equity Index; or b at or prior to the Closing Date by either party i because of a breach by the other party of any representation, warranty, or agreement contained therein to be performed at or prior to the Closing Date if not cured within 30 days, or ii because a condition to the obligation of the terminating party has not been met and it reasonably appears that it cannot be met.
The expenses of CoreFunds Equity Index in connection with the Reorganization including the cost of any proxy soliciting agent will be borne by FUNB whether or not the Reorganization is consummated. No portion of such expenses will be borne directly or indirectly by CoreFunds Equity Index or its shareholders. The Reorganization is intended to qualify for federal income tax purposes as a tax-free reorganization under section a of the Code. Treasury regulations issued thereunder, current administrative rules, pronouncements and court decisions, for federal income tax purposes, upon consummation of the Reorganization:.
Opinions of counsel are not binding upon the Internal Revenue Service or the courts. If the Reorganization is consummated but does not qualify as a tax-free reorganization under the Code, a shareholder of CoreFunds Equity Index would recognize a taxable gain or loss equal to the difference between his or her tax basis in his or her Fund shares and the fair market value of Evergreen Equity Index shares he or she received.
Shareholders of CoreFunds Equity Index should consult their tax advisers regarding the effect, if any, of the proposed Reorganization in light of their individual circumstances. Since the foregoing discussion relates only to the federal income tax consequences of the Reorganization, shareholders of CoreFunds Equity Index should also consult their tax advisers as to the state and local tax consequences, if any, of the Reorganization.
Capital loss carryforwards of CoreFunds Equity Index will be available to Evergreen Equity Index to offset capital gains recognized after the Reorganization, subject to limitations imposed by the Code. These limitations provide generally that the amount of loss carryforward which may be used in any year following the closing is an amount equal to the value of all of the outstanding stock of CoreFunds Equity Index immediately prior to the Reorganization, multiplied by a long-term tax-exempt bond rate determined monthly by the Internal Revenue Service.
The rate for February, was 5. A capital loss carryforward may generally be used without any limit to offset gains recognized on sale of assets transferred by CoreFunds Equity Index to Evergreen Equity Index pursuant to the Reorganization, to the extent of the excess of the value of any such asset on the closing date of the Reorganization over its tax basis.
The following table sets forth the capitalization of CoreFunds Equity Index as of December 31, , and the capitalization of Evergreen Equity Index on a pro forma basis as of that date, giving effect to the proposed acquisition of assets at net asset value.
The pro forma data reflects an exchange ratio of 1. The table set forth above should not be relied upon to reflect the number of shares to be received in the Reorganization; the actual number of shares to be received will depend upon the net asset value and number of shares outstanding of each Fund at the time of the Reorganization.
The following discussion is based upon and qualified in its entirety by the descriptions of the respective investment objectives, policies and restrictions set forth in the respective Prospectuses and Statement of Additional Information of the Funds. The investment objective, policies and restrictions of CoreFunds Equity Index can be found in the respective Prospectuses of the Fund under the caption "Information on the.
The investment objective and policies of each Fund are identical. Although each Fund's investment adviser does not screen securities by traditional methods of financing and market analyses, it monitors the Fund's investments with a view toward removing stocks of companies which exhibit extreme financial distress or which may impair the Fund's ability to achieve its investment objective.
Neither Fund may engage in options and futures transactions. Such obligations may include U. The characteristics of each investment policy and the associated risks are described in each Fund's respective Prospectuses and Statement of Additional Information. The Funds have other investment policies and restrictions which are also set forth in the Prospectuses and Statements of Additional Information of each Fund. Each entity is also governed by applicable Delaware, Maryland and federal law.
Fractional shares may be issued by either Fund. Each Fund's shares represent equal proportionate interests in the assets belonging to the Funds. Shareholders of each Fund are entitled to receive dividends and other amounts as determined by the Trustees or Directors.
Shareholders of each Fund vote separately, by class, as to matters, such as approval of or amendments to Rule 12b-1 distribution plans, that affect only their particular class and by Fund as to matters, such as approval of or amendments to investment advisory agreements or proposed reorganizations, that affect only their particular Fund.
Under Delaware law, shareholders of a Delaware business trust are entitled to the same limitation of personal liability extended to stockholders of Delaware corporations.
No similar statutory or other authority limiting business trust shareholder liability exists in any other state. As a result, to the extent that Evergreen Select Equity Trust or a shareholder is subject to the jurisdiction of courts in those states, it is possible that a. To guard against this risk, the Declaration of Trust of Evergreen Select Equity Trust a provides that any written obligation of the Trust may contain a statement that such obligation may only be enforced against the assets of the Trust or the particular series in question and the obligation is not binding upon the shareholders of the Trust; however, the omission of such a disclaimer will not operate to create personal liability for any shareholder; and b provides for indemnification out of Trust property of any shareholder held personally liable for the obligations of the Trust.
Accordingly, the risk of a shareholder of Evergreen Select Equity Trust incurring financial loss beyond that shareholder's investment because of shareholder liability is limited to circumstances in which: In light of Delaware law, the nature of the Trust's business, and the nature of its assets, the risk of personal liability to a shareholder of Evergreen Select Equity Trust is remote.
In addition, each is required to call a meeting of shareholders for the purpose of electing Trustees or Directors if, at any time, less than a majority of the Trustees or Directors then holding office were elected by shareholders. For Evergreen Equity Index, a majority of the votes cast and entitled to vote, and for CoreFunds Equity Index, a majority of the outstanding shares, is sufficient to act on a matter unless otherwise specifically.
Under the Declaration of Trust of Evergreen Select Equity Trust, each share of Evergreen Equity Index will be entitled to one vote for each dollar of net asset value applicable to each share. Under the voting provisions governing CoreFunds Equity Index, each share is entitled to one vote. Over time, the net asset values of the mutual funds which are each a series of CoreFunds, Inc. Because of the divergence in net asset values, a given dollar investment in a fund with a lower net asset value will purchase more shares, and under CoreFunds Equity Index's voting provisions, have more votes, than the same investment in a fund with a higher net asset value.
Under the Declaration of Trust of Evergreen Select Equity Trust, voting power is related to the dollar value of the shareholders' investment rather than to the number of shares held. In the event of the liquidation of Evergreen Equity Index or CoreFunds Equity Index, the shareholders are entitled to receive, when and as declared by the Trustees or Directors, respectively, the excess of the assets belonging to such Fund or attributable to the class over the liabilities belonging to the Fund or attributable to the class.
In either case, the assets so distributable to shareholders of the Fund will be distributed among the shareholders in proportion to the number of shares of a class of the Fund held by them and recorded on the books of the Fund. Under the Declaration of Trust of Evergreen Select Equity Trust, a Trustee is liable to the Trust and its shareholders only for such Trustee's own willful misfeasance, bad faith, gross negligence, or reckless disregard of the duties involved in the.
As provided in the Declaration of Trust, each Trustee of the Trust is entitled to be indemnified against all liabilities against him or her, including the costs of litigation, unless it is determined that the Trustee i did not act in good faith in the reasonable belief that such Trustee's action was in or not opposed to the best interests of the Trust; ii had acted with willful misfeasance, bad faith, gross negligence or reckless disregard of such Trustee's duties; and iii in a criminal proceeding, had reasonable cause to believe that such Trustee's conduct was unlawful collectively, "disabling conduct".
A determination that the Trustee did not engage in disabling conduct and is, therefore, entitled to indemnification may be based upon the outcome of a court action or administrative proceeding or by a a vote of a majority of those Trustees who are neither "interested persons" within the meaning of the Act nor parties to the proceeding or b an independent legal counsel in a written opinion. The Trust may also advance money for such litigation expenses provided that the Trustee undertakes to repay the Trust if his or her conduct is later determined to preclude indemnification and certain other conditions are met.
The Merger became effective on April 30, Pursuant to an order received from the SEC all fees payable under the Interim Advisory Agreement will be placed in escrow and paid to CSIA if shareholders approve the contract within days of its effective date. The Interim Advisory Agreement will remain in effect until the earlier of the Closing Date for the Reorganization or two years from its effective date. The terms of the Interim Advisory Agreement are essentially the same as the Previous Advisory Agreement as defined below.
The only difference between the Previous Advisory Agreement and the Interim Advisory Agreement, if approved by shareholders, is the. The Directors have authorized CoreFunds, Inc. Such Agreement became effective on April 30, If the Interim Advisory Agreement for CoreFunds Equity Index is not approved by shareholders, the Directors will consider appropriate actions to be taken with respect to CoreFunds Equity Index's investment advisory arrangements at that time.
The Previous Advisory Agreement was last approved by the Directors, including a majority of the Independent Directors, on June 5, Under the Previous Advisory Agreement and Interim Advisory Agreement, CSIA manages the investment portfolio of CoreFunds Equity Index, makes decisions about and places orders for all purchases and sales of the Fund's securities, and maintains certain records relating to these purchases and sales. See "Summary - Administrators.
See "Summary - Investment Advisers. Payment of Expenses and Transaction Charges. Under the Previous Advisory Agreement, CSIA was required to pay all expenses incurred by it in connection with its activities under the Agreement other than the cost of securities including brokerage commissions, if any purchased for the Fund and the cost of obtaining market quotations of portfolio securities held by the Fund.
The Previous Advisory Agreement provided that CSIA was not liable for any error of judgment or mistake of law or for any loss suffered by the Fund in connection with the performance of the Agreement, except a loss resulting from a breach of fiduciary duty with respect to the receipt of compensation for services or a loss resulting from willful misfeasance, bad faith, or gross negligence on the part of CSIA in the performance of its duties or from reckless disregard by it of its obligations and duties under the Agreement.
The Interim Advisory Agreement provides that it may be terminated without penalty by vote of a majority of the outstanding voting securities of CoreFunds Equity Index as defined in the Act or by a vote of a majority of CoreFunds, Inc. Also, the Interim Advisory Agreement will automatically terminate in the event of its assignment as defined in the Act. The Previous Advisory Agreement contained identical provisions as to termination and assignment.
CSIA is currently waiving a portion of its management fee. See "Comparison of Fees and Expenses. The Board of Directors considered, among other things, the factors set forth above in "Reasons for the Reorganization. Information concerning the operation and management of Evergreen Equity Index is incorporated herein by reference from the Prospectuses dated June 1, , copies of which are enclosed, and Statement of Additional Information of the same date.
Information about the Fund is included in its current Prospectuses dated November 1, and in the Statement of Additional Information of the same date, that have been filed with the SEC, all of which are incorporated herein by reference. Evergreen Equity Index and CoreFunds Equity Index are each subject to the informational requirements of the Securities Exchange Act of and the Act, and in accordance therewith file reports and other information including proxy material, and charter documents with the SEC.
The SEC maintains a Web site http: Only shareholders of record as of the close of business on the Record Date will be entitled to notice of, and to vote at, the Meeting or any adjournment thereof. The holders of a majority of the outstanding shares at the close of business on the Record Date present in person or represented by proxy will constitute a quorum for the Meeting. If the enclosed form of proxy is properly executed and returned in time to be voted at the Meeting, the proxies named therein will vote the shares represented by the proxy in accordance with the instructions marked thereon.
Proxies that reflect abstentions and "broker non-votes" i. A proxy may be revoked at any time on or before the Meeting by written notice to the Secretary of CoreFunds, Inc.
Unless revoked, all valid proxies will be voted in accordance with the specifications thereon or, in the absence of such specifications, FOR approval of the Plan and the Reorganization contemplated thereby and FOR approval of the Interim Advisory Agreement. Approval of the Plan will require the affirmative vote of a majority of the outstanding shares, with all classes voting together as a single class at the Meeting at which a quorum of the Fund's shares is present.
Each full share outstanding is entitled to one vote and each fractional share outstanding is entitled to a proportionate share of one vote. Proxy solicitations will be made primarily by mail, but proxy solicitations may also be made by telephone, telegraph or personal solicitations conducted by officers and employees of FUNB or CSIA, their affiliates or other representatives of CoreFunds Equity Index who will not be paid for their soliciting activities. Shareholder Communications Corporation "SCC" and its agents have been engaged by CoreFunds Equity Index to assist in soliciting proxies, and may call shareholders to ask if they would be willing to authorize SCC to execute a proxy on their behalf authorizing the voting of their shares in accordance with the instructions given over the telephone by the shareholders.
In addition, shareholders may call SCC at extension between the hours of 9: Eastern time in order to initiate the processing of their votes by telephone. SCC will utilize a telephone vote solicitation procedure designed to authenticate the shareholder's identity by asking the shareholder to provide his or her social security number in the case of an individual or taxpayer identification number in the case of an entity.
The shareholder's telephone instructions will be implemented in a proxy executed by SCC and a confirmation will be sent to the shareholder to ensure that the vote has been authorized in accordance with the shareholder's instructions. CoreFunds Equity Index believes that this telephonic voting system complies with applicable law and has reviewed an opinion of counsel to that effect. Any proxy given by you is revocable.
In the event that sufficient votes to approve the Reorganization are not received by July 17, , the persons named as proxies may propose one or more adjournments of the.
Meeting to permit further solicitation of proxies. In determining whether to adjourn the Meeting, the following factors may be considered: Any such adjournment will require an affirmative vote by the holders of a majority of the shares present in person or by proxy and entitled to vote at the Meeting.
The persons named as proxies will vote upon such adjournment after consideration of all circumstances which may bear upon a decision to adjourn the Meeting. A shareholder who objects to the proposed Reorganization will not be entitled under either Maryland law or the Articles of Incorporation of CoreFunds, Inc. However, shareholders should be aware that the Reorganization as proposed is not expected to result in recognition of gain or loss to shareholders for federal income tax purposes and that, if the Reorganization is consummated, shareholders will be free to redeem the shares of Evergreen Equity Index which they receive in the transaction at their then-current net asset value.
Shares of CoreFunds Equity Index may be redeemed at any time prior to the consummation of the Reorganization. Shareholders of CoreFunds Equity Index may wish to consult their tax advisers as to any differing consequences of redeeming Fund shares prior to the Reorganization or exchanging such shares in the Reorganization. CoreFunds Equity Index does not hold annual shareholder meetings.
If the Reorganization is not approved, shareholders wishing to submit proposals for consideration for inclusion in a proxy statement for a subsequent shareholder meeting should send their written proposals to the Secretary of CoreFunds, Inc.
If, however, any other matters are properly brought before the Meeting, the persons named in the accompanying form of proxy will vote thereon in accordance with their judgment. The names and addresses of the principal executive officers and directors of CoreStates Investment Advisers, Inc.
This Agreement is intended to be, and is adopted as, a plan of reorganization and liquidation within the meaning of Section a 1 F of the United States Internal Revenue Code of , as amended the "Code". WHEREAS, the Selling Fund and the Acquiring Fund are each a separate investment series of an open-end, registered investment company of the management type and the Selling Fund owns securities that generally are assets of the character in which the Acquiring Fund is permitted to invest;.
WHEREAS, the Trustees of the Trust have determined that the exchange of all of the assets of the Selling Fund for Acquiring Fund Shares and the assumption of the identified liabilities of the Selling Fund by the Acquiring Fund on the terms and conditions hereinafter set forth are in the best interests of the Acquiring Fund's shareholders;. Subject to the terms and conditions herein set forth and on the basis of the representations and warranties contained herein, the Selling Fund agrees to transfer all of the Selling Fund's assets as set forth in paragraph 1.
The Acquiring Fund agrees in exchange therefor i to deliver to the Selling Fund the number of Acquiring Fund Shares, including fractional Acquiring Fund Shares, determined by multiplying the shares outstanding of each class of the Selling Fund by the ratio computed by dividing the net asset value per share of each such class of the Selling Fund by the net asset value per share of the corresponding class of Acquiring Fund Shares computed in the manner and as of the time and date set forth in paragraph 2.
Such transactions shall take place at the closing provided for in paragraph 3. The assets of the Selling Fund to be acquired by the Acquiring Fund shall consist of all property, including, without limitation, all cash, securities, commodities, interests in futures and dividends or interest receivables, that is owned by the Selling Fund and any deferred or prepaid expenses shown as an asset on the books of the Selling Fund on the Closing Date.
The Selling Fund has provided the Acquiring Fund with its most recent audited financial statements, which contain a list of all of Selling Fund's assets as of the date thereof. The Selling Fund hereby represents that as of the date of the execution of this Agreement there have been no changes in its financial position as reflected in said financial statements other than those occurring in the ordinary course of its business in connection with the purchase and sale of securities and the payment of its normal operating expenses.
The Acquiring Fund will, within a reasonable time prior to the Closing Date, furnish the Selling Fund with a list of the securities, if any, on the Selling Fund's list referred to in the second sentence of this paragraph that do not conform to the Acquiring Fund's investment objectives, policies, and restrictions. The Selling Fund will, within a reasonable period of time prior to the Closing Date, furnish the Acquiring Fund with a list of its portfolio securities and other investments. In the event that the Selling Fund holds any investments that the Acquiring Fund may not hold, the Selling Fund, if requested by the Acquiring Fund, will dispose of such securities prior to the Closing Date.
In addition, if it is determined that the Selling Fund and the Acquiring Fund portfolios, when aggregated, would contain investments exceeding certain percentage limitations imposed upon the Acquiring Fund with respect to such investments, the Selling Fund if requested by the Acquiring Fund will dispose of a sufficient amount of such investments as may be necessary to avoid violating such limitations as of the Closing Date.
Notwithstanding the foregoing, nothing herein will require the Selling Fund to dispose of any investments or securities if, in the reasonable judgment of the Selling Fund, such disposition would adversely affect the tax-free nature of the Reorganization or would violate the Selling Fund's fiduciary duty to its shareholders.
The Selling Fund will endeavor to discharge all of its known liabilities and obligations prior to the Closing Date. The Acquiring Fund shall assume only those liabilities, expenses, costs, charges and reserves reflected on a Statement of Assets and Liabilities of the Selling Fund prepared on behalf of the Selling Fund, as of the Valuation Date as defined in paragraph 2.
The Acquiring Fund shall assume only those liabilities of the Selling Fund reflected in such Statement of Assets and Liabilities and shall not assume any other liabilities, whether absolute or contingent, known or unknown, accrued or unaccrued, all of which shall remain the obligation of the Selling Fund.
In addition, upon completion of the Reorganization, for purposes of calculating the maximum amount of sales charges including asset based sales charges permitted to be imposed by the Acquiring Fund under the National Association of Securities Dealers, Inc. On or as soon after the Closing Date as is conveniently practicable the "Liquidation Date" , a the Selling Fund will liquidate and distribute pro rata to the Selling Fund's shareholders of record, determined as of the close of business on the Valuation Date the "Selling Fund Shareholders" , the Acquiring Fund Shares received by the Selling Fund pursuant to paragraph 1.
Such liquidation and distribution will be accomplished by the transfer of the Acquiring Fund Shares then credited to the account of the Selling Fund on the books of the Acquiring Fund to open accounts on the share records of the Acquiring Fund in the names of the Selling Fund Shareholders and representing the respective pro rata number of the Acquiring Fund Shares due such shareholders.
All issued and outstanding shares of the Selling Fund will simultaneously be canceled on the books of the Selling Fund.
The Acquiring Fund shall not issue certificates representing the Acquiring Fund Shares in connection with such exchange. Ownership of Acquiring Fund Shares will be shown on the books of the Acquiring Fund's transfer agent. Shares of the Acquiring Fund will be issued in the manner described in the combined Prospectus and Proxy Statement on Form N to be distributed to shareholders of the Selling Fund as described in paragraph 5.
Any transfer taxes payable upon issuance of the Acquiring Fund Shares in a name other than the registered holder of the Selling Fund shares on the books of the Selling Fund as of that time shall, as a condition of such issuance and transfer, be paid by the person to whom such Acquiring Fund Shares are to be issued and transferred.
Any reporting responsibility of the Selling Fund is and shall remain the responsibility of the Selling Fund up to and including the Closing Date and such later date on which the Selling Fund is terminated. The Selling Fund shall be terminated promptly following the Closing Date and the making of all distributions pursuant to paragraph 1. The value of the Selling Fund's assets to be acquired by the Acquiring Fund hereunder shall be. The net asset value per share of the Acquiring Fund Shares shall be the net asset value per share computed as of the close of business on the New York Stock Exchange on the Valuation Date, using the valuation procedures set forth in the Trust's Declaration of Trust and the Acquiring Fund's then current prospectuses and statement of additional information.
The number of the Acquiring Fund Shares of each class to be issued including fractional shares, if any in exchange for the Selling Fund's assets shall be determined by multiplying the shares outstanding of each class of the Selling Fund by the ratio computed by dividing the net asset value per share of the Selling Fund attributable to each of its classes by the net asset value per share of the respective classes of the Acquiring Fund determined in accordance with paragraph 2.
All computations of value shall be made by State Street Bank and Trust Company in accordance with its regular practice in pricing the shares and assets of the Acquiring Fund. The Closing the "Closing" shall take place on or about July 27, or such other date as the parties may agree to in writing the "Closing Date".
All acts taking place at the Closing shall be deemed to take place simultaneously immediately prior to the opening of business on the Closing Date unless otherwise provided. The Closing shall be held as of 9: In the event that on the Valuation Date a the New York Stock Exchange or another primary trading market for portfolio securities of the Acquiring Fund or the Selling Fund shall be closed to trading or trading thereon shall be restricted; or b trading or the reporting of trading on said Exchange or elsewhere shall be disrupted so that accurate appraisal of the value of the net assets of the Acquiring Fund or the Selling Fund is impracticable, the Valuation Date shall be postponed until the first business day after the day when trading shall have been fully resumed and reporting shall have been restored.
Evergreen Service Company, as transfer agent for the Selling Fund as of the Closing Date, shall deliver at the Closing a certificate of an authorized officer stating that its records contain the names and addresses of the Selling Fund Shareholders and the number and percentage ownership of outstanding shares owned by each such shareholder immediately prior to the Closing.
The Acquiring Fund shall issue and deliver or cause Evergreen Service Company, its transfer agent, to issue and deliver a confirmation evidencing the Acquiring Fund Shares to be credited on the Closing Date to the Secretary of CoreFunds or provide evidence satisfactory to the Selling Fund that such Acquiring Fund Shares have been credited to the Selling Fund's account on the books of the Acquiring Fund.
At the Closing, each party shall deliver to the other such bills of sale, checks, assignments, share certificates, if any, receipts and other documents as such other party or its counsel may reasonably request. The Selling Fund represents and warrants to the Acquiring Fund as follows:. The Selling Fund knows of no facts that might form the basis for the institution of such proceedings and is not a party to or subject to the provisions of any order, decree, or judgment of any court or governmental body that materially and adversely affects its.
For the purposes of this subparagraph h , a decline in the net asset value of the Selling Fund shall not constitute a material adverse change. To the best of the Selling Fund's knowledge, no such return is currently under audit, and no assessment has been asserted with respect to such returns. All of the issued and outstanding shares of the Selling Fund will, at the time of the Closing Date, be held by the persons and in the amounts set forth in the records of the transfer agent as provided in paragraph 3.
The Selling Fund does not have outstanding any options, warrants, or other rights to subscribe for or purchase any of the Selling Fund shares, nor is there outstanding any security convertible into any of the Selling Fund shares. The Acquiring Fund represents and warrants to the Selling Fund as follows:. The Acquiring Fund knows of no facts that might form the basis for the institution of such proceedings and is not a party to or subject to the provisions of any order, decree, or judgment of any court or governmental body that materially and adversely affects its business or its ability to consummate the transactions contemplated herein.
For the purposes of this subparagraph g , a decline in the net asset value of the Acquiring Fund shall not constitute a material adverse change. To the best of the Acquiring Fund's knowledge, no such return is currently under audit, and no assessment has been asserted with respect to such returns. The Acquiring Fund does not have outstanding any options, warrants, or other rights to subscribe for or purchase any Acquiring Fund Shares, nor is there outstanding any security convertible into any Acquiring Fund Shares.
The Acquiring Fund and the Selling Fund each will operate its business in the ordinary course between the date hereof and the Closing Date, it being understood that such ordinary course of business will include customary dividends and distributions.
CoreFunds will call a meeting of the Selling Fund Shareholders to consider and act upon this Agreement and to take all other action necessary to obtain approval of the transactions contemplated herein. The Selling Fund covenants that the Acquiring Fund Shares to be issued hereunder are not being acquired for the purpose of making any distribution thereof other than in accordance with the terms of this Agreement. The Selling Fund will assist the Acquiring Fund in obtaining such information as the Acquiring Fund reasonably requests concerning the beneficial ownership of the Selling Fund shares.
Subject to the provisions of this Agreement, the Acquiring Fund and the Selling Fund will each take, or cause to be taken, all action, and do or cause to be done, all things reasonably necessary, proper or advisable to consummate and make effective the transactions contemplated by this Agreement, including any actions required to be taken after the Closing Date. As promptly as practicable, but in any case within sixty days after the Closing Date, the Selling Fund shall furnish the Acquiring Fund, in such form as is reasonably satisfactory to the Acquiring Fund, a statement of the earnings and profits of the Selling Fund for federal income tax purposes that will be carried over by the Acquiring Fund as a result of Section of the Code, and which will be reviewed by KPMG Peat Marwick LLP and certified by CoreFunds' President and Treasurer.
The Selling Fund will provide the Acquiring Fund with information reasonably necessary for the preparation of a prospectus, which will include the proxy statement, referred to in paragraph 4.
As promptly as practicable, but in any case within sixty days after the Closing Date, the Acquiring Fund and the Selling Fund shall cause KPMG Peat Marwick LLP to issue a letter addressed to the Acquiring Fund and the Selling Fund, in form and substance satisfactory to the Funds, setting forth the federal income tax implications relating to capital loss carryforwards if any of the Selling Fund and the related impact, if any, of the proposed transfer of all of the assets of the Selling Fund to the Acquiring Fund and the ultimate dissolution of the Selling Fund, upon the shareholders of the Selling Fund.
The obligations of the Selling Fund to consummate the transactions provided for herein shall be subject, at its election, to the performance by the Acquiring Fund of all the obligations to be performed by it hereunder on or before the Closing Date, and, in addition thereto, the following further conditions:.
Such opinion may state that such counsel does not express any opinion or belief as. In this paragraph 6. The obligations of the Acquiring Fund to complete the transactions provided for herein shall be subject, at its election, to the performance by the Selling Fund of all the obligations to be performed by it hereunder on or before the Closing Date and, in addition thereto, the following conditions:.
Selling Fund, in a form satisfactory to the Acquiring Fund covering the following points:. Such opinion may state that they do not express any opinion or belief as to the financial statements or any financial or statistical data, or as to the information relating to the Acquiring Fund, contained in the Prospectus and Proxy Statement or Registration Statement, and that such opinion is solely for the benefit of the Trust and the Acquiring Fund.
In this paragraph 7. If any of the conditions set forth below do not exist on or before the Closing Date with respect to the Selling Fund or the Acquiring Fund, the other party to this Agreement shall, at its option, not be required to consummate the transactions contemplated by this Agreement:.
Notwithstanding anything herein to the contrary, neither the Acquiring Fund nor the Selling Fund may waive the conditions set forth in this paragraph 8. Such expenses include, without limitation, a expenses incurred in connection with the entering into and the carrying out of the provisions of this Agreement; b expenses associated with the preparation and filing of the Registration Statement under the Act covering the Acquiring Fund Shares to be issued pursuant to the provisions of this Agreement; c registration or qualification fees and expenses of preparing and filing such forms as are necessary under applicable state securities laws to qualify the Acquiring Fund.
Shares to be issued in connection herewith in each state in which the Selling Fund Shareholders are resident as of the date of the mailing of the Prospectus and Proxy Statement to such shareholders; d postage; e printing; f accounting fees; g legal fees; and h solicitation costs of the transaction. Notwithstanding the foregoing, the Acquiring Fund shall pay its own federal and state registration fees. In such event, all expenses of the transactions contemplated by this Agreement incurred by the Acquiring Fund will be borne by FUNB and all expenses of the transactions contemplated by this Agreement incurred by the Selling Fund will be borne by CoreStates Investment Advisers, Inc.
In addition, either the Acquiring Fund or the Selling Fund may at its option terminate this Agreement at or prior to the Closing Date because:. CoreFunds, the respective Trustees, Directors or officers, to the other party or its Trustees, Directors or officers, but each shall bear the expenses incurred by it incidental to the preparation and carrying out of this Agreement as provided in paragraph 9.
Nothing herein expressed or implied is intended or shall be construed to confer upon or give any person, firm, or corporation, other than the parties hereto and their respective. The execution and delivery of this Agreement have been authorized by the Trustees of the Trust on behalf of the Acquiring Fund and signed by authorized officers of the Trust, acting as such, and neither such authorization by such Trustees nor such execution and delivery by such officers shall be deemed to have been made by any of them individually or to impose any liability on any of them personally, but shall bind only the trust property of the Acquiring Fund as provided in the Declaration of Trust of the Trust.
The Company hereby appoints the Investment Adviser to act as investment adviser to the portfolios of the Company for the period and on the terms set forth in this Agreement.
The Investment Adviser accepts such appointment and agrees to furnish the services herein set forth for the compensation herein provided.
The Fund has furnished the Investment Adviser with copies properly certified or authenticated of each of the following:. The Company will furnish the Investment Adviser from time to time with copies of all amendments of or supplements to the foregoing.
Subject to the supervision of the Company's Board of Directors, the Investment Adviser will provide a continuous investment program for each portfolio of the Company, including investment guidelines and management with respect to all securities and investments and cash equivalents held by the existing portfolios and such other portfolios hereinafter collectively, the "Portfolios" offered by the Company and identified by the Company as appropriate.
The Investment Adviser will determine from time to time what securities and other investments will be purchased, retained, or sold by the Company. The Investment Adviser will provide the services under this Agreement in accordance with the Company's investment objective, policies, and restrictions as stated in the Prospectuses and resolutions of the Company's Board of Directors.
In placing orders with brokers and dealers the primary consideration of the Investment Adviser will be the prompt execution of orders in an effective manner at the most favorable price. Subject to this consideration, brokers or dealers who provide supplemental research to the Investment Adviser may receive orders for transactions with the Company.
In no instance will portfolio securities be purchased from or sold to CoreStates Financial Corp or any affiliated person of either the Fund or CoreStates Financial Corp;. The investment management services furnished by the Investment Adviser hereunder are not to be deemed exclusive, and the Investment Adviser shall be free to. In compliance with the requirements of Rule 31a-3 under the Act, the Investment Adviser hereby agrees that all records which it maintains for the Company are the property of the Company and further agrees to surrender promptly to the Company any of such records upon the Company's request.
The Investment Adviser further agrees to preserve for the periods prescribed by Rule 31a-2 under the Act the records required to be maintained by Rule 31a-1 under the Act. During the term of this Agreement, the Investment Adviser will pay all expenses incurred by it in connection with its activities under this Agreement other than the cost of securities including brokerage commissions, if any purchased for the Company and the cost of obtaining market quotations of portfolio securities held by the Company.
For the services provided and the expenses assumed pursuant to this Agreement, effective as of the date of this Agreement, the Company will pay the Investment Adviser and the Investment Adviser will accept as full compensation for services rendered to the Portfolios therefor, the fees detailed in Appendix A attached to this Agreement; provided, however, that if the total expenses borne by any Portfolio of the Company in any fiscal year of the Company exceeds any expense limitations imposed by applicable state securities laws or regulations, the Investment Adviser will reimburse the Portfolio for a portion of such excess equal to the amount of such excess times the ratio of the fees otherwise payable to the Investment Adviser hereunder to the aggregate fees otherwise payable to the Investment Adviser hereunder and SEI Fund Resources pursuant to an Administration Agreement between it and the Company.
The Investment Adviser's obligation to reimburse the Company on behalf of its Portfolios hereunder is limited in any fiscal year of the Company to the amount of the Investment Adviser's fee hereunder for such fiscal year; provided, however, that notwithstanding the foregoing, the Investment Adviser shall reimburse the Company for such excess regardless of the fees paid to it to the extent that the securities laws or regulations of any state having jurisdiction over the Company so require.
Any such expense reimbursements will be estimated daily and reconciled and paid on a monthly basis. Use of Investment Adviser's Name and Logo. The Company agrees that it shall furnish to the Investment Adviser, prior to any use or distribution thereof, copies of all prospectuses,. The Company further agrees that it shall not use or distribute any such material if the Investment Adviser reasonably objects in writing to such use or distribution within ten business days after the date such material is furnished to the Investment Adviser.
The provisions of this section shall survive the termination of this Agreement. The Investment Adviser shall not be liable for any error of judgment or mistake of law or for any loss suffered by the Company in connection with the performance of this Agreement, except a loss resulting from a breach of fiduciary duty with respect to the receipt of compensation for services or a loss resulting from willful misfeasance, bad faith, or gross negligence on the part of the Investment Adviser in the performance of its duties or from reckless disregard by it of its obligations and duties under this Agreement.
This Agreement will become effective for each Portfolio as of the date first above written. Subject to the provisions for termination as provided herein, this Agreement shall remain in effect for each Portfolio until the earlier of the Closing Date defined in the Agreement and Plan of Reorganization dated as of April 15, with respect to each Portfolio or for two years from the date first above written and from year to year thereafter, provided such continuance is specifically approved at least annually a by the vote of a majority of those members of the Company's Board of Directors who are not parties to this Agreement or interested persons of any party to this Agreement, cast in person at a meeting called for the purpose of voting on such approval, and b by the Company's Board of Directors or by vote of a majority of the Portfolio's outstanding voting securities.
Notwithstanding the foregoing, this Agreement may be terminated at any time on sixty days written notice, without the payment of any penalty, by the Company by vote of the Board of Directors or by vote of a majority of the Portfolio's outstanding voting securities or by the Investment Adviser.
This Agreement will immediately terminate in the event of its assignment. As used in this Agreement, the terms "majority of the outstanding voting securities," "interested persons" and "assignment" shall have the same meaning of such terms in the Act.
Name Protection After Termination. In the event this Agreement is terminated by either party or upon written notice from the Investment Adviser at any time, the Company hereby agrees that it will eliminate from its corporate name any references to the name "CoreFunds. Amendment of this Agreement. No provision of this Agreement may be changed, waived, discharged, or terminated orally, but only by an instrument in writing signed by the party against which enforcement of the change, waiver, discharge or termination is sought.
No amendment of this Agreement shall be effective until approved by vote of a majority of the Portfolio's outstanding voting securities.
The captions in this Agreement are included for convenience of reference only and in no way define or delimit any of the provisions hereof or otherwise affect their construction or effect. If any provision of this Agreement shall be held or made invalid by a court decision, statute, rule, or otherwise, the remainder of this Agreement shall not be affected thereby. This Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective successors and shall be governed by Pennsylvania law.
The date of this Statement of Additional Information is June 1, Each Fund is a series of an open-end management investment company, known as "Evergreen Select Equity Trust" the "Trust". It is not a prospectus and you should read it in conjunction with the prospectus of the Funds , as supplemented from time to time. You may obtain a copy of the prospectus from, Evergreen Distributor, Inc. The investment objectives of each Fund and a description of the securities in which each Fund may invest is set forth in the Funds' prospectus.
The following expands upon the discussion in the prospectus regarding certain investments of the Funds. Additional Information on Securities and Investment Practices.
Equity securities consist primarily of common stocks and securities convertible into common stocks. Investing in common stocks, particularly those having growth characteristics, frequently involves greater risks and possibly greater rewards than investing in other types of securities. Common stock prices tend to be more volatile and companies having growth characteristics may sometimes be unproven. Investing in companies with medium market capitalizations involves greater risk than investing in larger companies.
The stock prices of mid-cap companies can rise quickly and drop substantially in a short period of time. This volatility results from a number of factors, including reliance by these companies on relatively limited product lines, markets, and financial resources.
These and other factors may make mid-cap companies more susceptible to setbacks or downturns. Investing in companies with small market capitalizations involves greater risk than investing in larger companies.
Their stock prices can rise very quickly and drop dramatically in a short period of time. This volatility results from a number of factors, including reliance by these companies on limited product lines, markets, and financial and management resources. These and other factors may make small cap companies more susceptible to setbacks or downturns.
These companies may experience higher rates of bankruptcy or other failures than larger companies. They may be more likely to be negatively affected by changes in management. In addition, the stock of small cap companies may be thinly traded.
Derivatives are financial contracts whose value depends on, or is derived from, the value of an underlying asset, reference rate or index.
These assets, rates, and indices may include bonds, stocks, mortgages, commodities, interest rates, currency exchange rates, bond indices, and stock indices. Derivatives may be standardized, exchange-traded contracts or customized, privately negotiated contracts. Exchange-traded derivatives tend to be more liquid and subject to less credit risk than those that are privately negotiated. There are four principal types of derivative instruments -- options, futures, forwards, and swaps -- from which virtually any type of derivative transaction can be created.
The term is also used to describe certain securities issued in connection with the restructuring of certain foreign obligations. The term "derivative" is also sometimes used to describe securities involving rights to a portion of the cash flows from an underlying pool of mortgages or other assets from which payments are passed through to the owner of, or that collateralize, the securities. The Funds can use derivatives to earn income, to enhance returns, to hedge or adjust the risk profile of the portfolio, in place of more traditional direct investments or to obtain exposure to otherwise inaccessible markets.
A Fund's use derivatives for non-hedging purposes entails greater risks than if a Fund were to derivatives solely for hedging purposes. Derivatives are a valuable tool which, when used properly, can provide significant benefit to a Fund's shareholders. The Funds' investment adviser is not an aggressive user of derivatives with respect to the Funds.
However, a Fund may take positions in those derivatives that are within its investment policies if, in the Adviser's judgment, this represents an effective response to current or anticipated market conditions. While the judicious use of derivatives by experienced investment managers, such as the Adviser, can be beneficial, derivatives also involve risks different from, and, in certain cases, greater than, the risks presented by more traditional investments.
This includes executing transactions through or for the benefit of a third party when the transaction is not in keeping with the general principles of this Code.
Under this rule, no Employee may:. Employees who, in connection with their regular functions or duties, make, participate in, or obtain information regarding the purchase or sale of securities by a Fund, or whose functions relate to the making of any recommendation with respect to purchases or sales.
The Compliance Officer will maintain a current list of all Advisory Employees. The Compliance Officer will maintain a current list of all Employees. The term Securities Transaction does not include transactions executed by the Adviser for the benefit of unaffiliated persons, such as investment advisory and brokerage clients.
The Personal Investment Guidelines in this Section III do not apply to Exempt Transactions unless the transaction involves a private placement or initial public offering.
Securities Transactions executed in violation of this prohibition shall be unwound or, if not possible or practical, the Employee must disgorge to the Fund the value received by the Employee due to any favorable price differential received by the Employee.
Any Securities Transactions in a private placement must be authorized by the Compliance Officer, in writing, prior to the transaction. If the private placement acquisition is authorized, the Compliance Officer shall retain a record of the authorization and the rationale supporting the authorization.
Employees who have been authorized to acquire securities in a private placement will, in connection therewith, be required to disclose that investment if and when the Employee takes part in any subsequent investment in the same issuer.
In such circumstances, the determination to purchase Securities of that issuer on behalf of a Fund will be subject to an independent review by personnel of the Adviser with no personal interest in the issuer. Employees are prohibited from acquiring any Securities in an initial public offering without the prior written approval of the Compliance Officer. If the initial public offering is authorized, the Compliance Officer shall retain a record of the authorization and the rationale supporting the authorization.
Employees are prohibited from serving on the boards of directors of publicly traded companies, absent prior authorization by the Compliance Officer. In the event that board service is. Within ten 10 days of commencement of employment with the Trust or the Adviser, each Employee must certify that he or she has read and understands this Code and recognizes that he or she is subject to it, and must disclose the following information, which information must be current as of a date no more than 45 days prior to the date the person became an Employee: Annually, each Employee must certify that he or she has read and understands this Code and recognizes that he or she is subject to it, that he or she has complied with the requirements of this Code and has disclosed or reported all personal Securities Transactions required to be disclosed or reported pursuant to the requirements of this Code.
In addition, each Employee shall annually provide the following information as of a date no more than 30 days before the report is submitted: All Employees must provide copies of all periodic broker account statements to the Compliance Officer.
Each Employee must report, no later than thirty 30 days after the close of each calendar quarter, on the Securities Transaction Report form provided by the Trust or the Adviser, all transactions in which the Employee acquired or sold any direct or indirect Beneficial Interest in a Security, including Exempt Transactions, and certify that he or she has reported all transactions required to be disclosed pursuant to the requirements of this Code.
The report will also identify any trading account, in which the Employee has a direct or indirect Beneficial Interest, established during the quarter with a broker, dealer or bank.
The Employee may exclude transactions effected pursuant to an automatic investment plan. An automatic investment plan is a program in which regular periodic purchases or withdrawals are made automatically in or from investment accounts in accordance with a predetermined schedule and allocation.
An automatic investment plan includes a dividend reinvestment plan. The Compliance Officer will, on a quarterly basis, check the trading account statements provided by brokers to verify that the Employee has not violated the Code.
The Compliance Officer shall identify all Employees, inform those persons of their reporting obligations, and maintain a record of all current and former access persons. Please list all Securities in which you have a Beneficial Interest, as defined in the Code of Ethics.
Please list all brokers, dealers and banks that maintain a brokerage account in which you have a Beneficial Interest, as defined in the Code of Ethics.
Certified Shareholder Report Mutual Fund Series Trust
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