Edgar Filing: EVERGREEN INCOME ADVANTAGE FUND

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM N-Q

QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED MANAGEMENT

INVESTMENT COMPANY

Investment Company Act file number 811-21269

Evergreen Income Advantage Fund

(Exact name of registrant as specified in charter)

200 Berkeley Street

Boston, Massachusetts 02116

(Address of principal executive offices) (Zip code)

Michael H. Koonce, Esq.

200 Berkeley Street

Boston, Massachusetts 02116

(Name and address of agent for service)

Registrant’s telephone number, including area code: (617) 210-3200

Date of fiscal year end:

Registrant is making a quarterly filing for one of its series, Evergreen Income Advantage Fund, for the quarter ended January 31, 2010. This series has April 30 fiscal year end.

Date of reporting period: January 31, 2010

Item 1 – Schedule of Investments

EVERGREEN INCOME ADVANTAGE FUND SCHEDULE OF INVESTMENTS



January 31, 2010 (unaudited)
	Principal Amount		Value


CORPORATE BONDS 107.7%
CONSUMER DISCRETIONARY 18.9%
Auto Components 2.0%
Affinia Group Intermediate Holdings, Inc., 10.75%, 08/15/2016 144A	$	230,000	$	251,850
Cooper Tire & Rubber Co., 7.625%, 03/15/2027		4,775,000		4,297,500
Goodyear Tire & Rubber Co.:
7.86%, 08/15/2011		2,545,000		2,634,075
8.625%, 12/01/2011		1,420,000		1,469,700
9.00%, 07/01/2015		497,000		511,910
10.50%, 05/15/2016		2,475,000		2,685,375
Metaldyne Corp., FRN, 5.28%, 04/09/2014		902,645		727,739
TRW Automotive, Inc., 8.875%, 12/01/2017 144A		250,000		259,375


				12,837,524


Diversified Consumer Services 1.8%
Carriage Services, Inc., 7.875%, 01/15/2015		3,105,000		2,957,513
Service Corporation International:
6.75%, 04/01/2015		205,000		201,925
7.50%, 04/01/2027		3,931,000		3,636,175
8.00%, 11/15/2021		880,000		881,100
StoneMor Partners, LP, 10.25%, 12/01/2017 144A		4,005,000		4,165,200


				11,841,913


Hotels, Restaurants & Leisure 3.5%
AMC Entertainment, Inc., 8.75%, 06/01/2019		235,000		243,225
Boyd Gaming Corp.:
7.125%, 02/01/2016		1,880,000		1,677,900
7.75%, 12/15/2012		950,000		954,750
Caesars Entertainment, Inc., 7.875%, 03/15/2010		1,465,000		1,468,662
Harrahs Entertainment Corp.:
10.00%, 12/15/2018		460,000		365,700
11.25%, 06/01/2017		4,285,000		4,552,812
Inn of the Mountain Gods Resort & Casino, 12.00%, 11/15/2010 • +		1,685,000		829,863
Landry’s Restaurants, Inc., 11.625%, 12/01/2015 144A		265,000		284,875
MGM MIRAGE:
6.625%, 07/15/2015		920,000		761,300
8.50%, 09/15/2010		1,645,000		1,653,225
11.125%, 11/15/2017 144A		620,000		697,500
11.375%, 03/01/2018 144A		630,000		595,350
Pinnacle Entertainment, Inc., 7.50%, 06/15/2015		2,545,000		2,354,125
Pokagon Gaming Authority, 10.375%, 06/15/2014 144A		120,000		125,250
Scientific Games Corp., 9.25%, 06/15/2019 144A		1,285,000		1,352,463
Seneca Gaming Corp., 7.25%, 05/01/2012		385,000		375,375
Shingle Springs Tribal Gaming Authority, 9.375%, 06/15/2015 144A		2,790,000		2,204,100
Speedway Motorsports, Inc., 8.75%, 06/01/2016		2,075,000		2,204,687
Trump Entertainment Resorts, Inc., 8.50%, 06/01/2015 •		5,011,000		150,330
Universal City Development Partners, Ltd.:
8.875%, 11/15/2015 144A		125,000		125,938
10.875%, 11/15/2016 144A		125,000		129,375
Wynn Resorts, Ltd., 7.875%, 11/01/2017 144A		105,000		105,000


				23,211,805


Household Durables 1.9%
D.R. Horton, Inc., 9.75%, 09/15/2010		4,820,000		4,976,650
Lennar Corp.:
5.125%, 10/01/2010		1,230,000		1,239,225
12.25%, 06/01/2017		125,000		152,500
Libbey, Inc.:
10.00%, 02/15/2015 144A		860,000		864,300
FRN, 7.48%, 06/01/2011		1,320,000		1,353,000

EVERGREEN INCOME ADVANTAGE FUND SCHEDULE OF INVESTMENTS continued



January 31, 2010 (unaudited)
	Principal Amount		Value


CORPORATE BONDS continued
CONSUMER DISCRETIONARY continued
Household Durables continued
Meritage Homes Corp., 7.00%, 05/01/2014	$	935,000	$	898,769
Newell Rubbermaid, Inc., 10.60%, 04/15/2019		2,290,000		2,967,668
Sealy Corp., 10.875%, 04/15/2016 144A		165,000		184,800


				12,636,912


Internet & Catalog Retail 0.4%
Netflix, Inc., 8.50%, 11/15/2017 144A		170,000		179,350
QVC, Inc., 7.50%, 10/01/2019 144A		990,000		1,014,750
Ticketmaster Entertainment, Inc., 10.75%, 08/01/2016		1,115,000		1,218,138


				2,412,238


Media 6.9%
Cablevision Systems Corp., 8.625%, 09/15/2017 144A		210,000		217,350
CCH II, LLC, 13.50%, 11/30/2016		12,586,015		15,134,683
CCO Holdings, LLC, 8.75%, 11/15/2013		8,075,000		8,186,031
Charter Communications, Inc., Step Bond:
8.00%, 04/30/2012 144A ††		3,500,000		3,657,500
10.875%, 09/15/2014 144A ††		10,840,000		12,140,800
Clear Channel Communications, Inc., 9.25%, 12/15/2017 144A		815,000		838,213
CSC Holdings, Inc., 8.50%, 04/15/2014 144A		50,000		53,000
DirectTV Holdings, LLC, 7.625%, 05/15/2016		200,000		219,000
DISH DBS, Corp., 7.875%, 09/01/2019		630,000		650,475
Lamar Media Corp.:
7.25%, 01/01/2013		440,000		440,000
9.75%, 04/01/2014		120,000		131,400
Regal Cinemas, Inc., 8.625%, 07/15/2019		205,000		211,662
Salem Communications Corp., 9.625%, 12/15/2016 144A		485,000		511,675
Sirius XM Radio, Inc.:
9.625%, 08/01/2013		315,000		321,300
9.75%, 09/01/2015 144A		250,000		266,250
WMG Acquisition Corp., 9.50%, 06/15/2016 144A		115,000		123,338
XM Satellite Radio Holdings, Inc.:
11.25%, 06/15/2013 144A		1,070,000		1,144,900
13.00%, 08/01/2013 144A		815,000		894,462
Young Broadcasting, Inc.:
8.75%, 01/15/2014 •		4,739,000		33,173
10.00%, 03/01/2011 •		3,455,000		24,185


				45,199,397


Multiline Retail 0.3%
Macy’s, Inc.:
5.90%, 12/01/2016		130,000		124,150
8.875%, 07/15/2015		340,000		370,600
Neiman Marcus Group, Inc., 9.75%, 10/15/2015 @		114,000		110,865
Saks, Inc., 9.875%, 10/01/2011		1,270,000		1,330,325


				1,935,940


Specialty Retail 1.0%
American Achievement Corp.:
8.25%, 04/01/2012 144A		5,850,000		5,835,375
Sr. Disc. Note, Step Bond, 10.25%, 10/01/2012 ††		385,000		385,481
Limited Brands, Inc., 8.50%, 06/15/2019 144A		90,000		98,100


				6,318,956


Textiles, Apparel & Luxury Goods 1.1%
Oxford Industries, Inc., 11.375%, 07/15/2015		3,350,000		3,752,000
Visant Corp., 7.625%, 10/01/2012		3,235,000		3,251,175


				7,003,175

EVERGREEN INCOME ADVANTAGE FUND SCHEDULE OF INVESTMENTS continued



January 31, 2010 (unaudited)
	Principal Amount		Value


CORPORATE BONDS continued
CONSUMER STAPLES 3.6%
Beverages 0.0%
Cott Beverages, Inc., 8.375%, 11/15/2017 144A	$	250,000	$	256,875


Food & Staples Retailing 0.1%
Rite Aid Corp., 10.25%, 10/15/2019 144A		250,000		260,000


Food Products 3.1%
Del Monte Foods Co.:
6.75%, 02/15/2015		150,000		153,375
7.50%, 10/15/2019 144A		3,855,000		3,961,013
Dole Food Company, Inc.:
8.00%, 10/01/2016 144A		1,225,000		1,267,875
13.875%, 03/15/2014 144A		2,702,000		3,228,890
Fage USA Dairy Industry, Inc., 9.875%, 02/01/2020 144A		750,000		701,634
Smithfield Foods, Inc.:
7.00%, 08/01/2011		3,035,000		3,035,000
10.00%, 07/15/2014 144A		4,150,000		4,518,312
Tyson Foods, Inc.:
7.85%, 04/01/2016		1,790,000		1,879,500
10.50%, 03/01/2014		115,000		132,825
Viskase, Inc., 9.875%, 01/15/2018 144A		1,425,000		1,425,000


				20,303,424


Tobacco 0.4%
Altria Group, Inc., 9.70%, 11/10/2018		1,975,000		2,473,504


ENERGY 15.9%
Energy Equipment & Services 4.2%
Basic Energy Services, Inc., 11.625%, 08/01/2014		780,000		846,300
Bristow Group, Inc.:
6.125%, 06/15/2013		205,000		203,975
7.50%, 09/15/2017		3,315,000		3,339,862
Forbes Energy Services, Ltd., 11.00%, 02/15/2015		4,850,000		4,668,125
GulfMark Offshore, Inc., 7.75%, 07/15/2014		3,155,000		3,131,338
Hercules Offshore, Inc., 10.50%, 10/15/2017 144A		1,220,000		1,268,800
Hornbeck Offshore Services, Inc.:
8.00%, 09/01/2017 144A		2,315,000		2,338,150
Ser. B, 6.125%, 12/01/2014		4,415,000		4,205,287
Parker Drilling Co., 9.625%, 10/01/2013		1,850,000		1,900,875
PHI, Inc., 7.125%, 04/15/2013		4,315,000		4,271,850
Pride International, Inc., 8.50%, 06/15/2019		210,000		240,450
SEACOR Holdings, Inc., 7.375%, 10/01/2019		990,000		1,029,603


				27,444,615


Oil, Gas & Consumable Fuels 11.7%
Alon Refining Krotz Springs, Inc., 13.50%, 10/15/2014 144A		2,600,000		2,392,000
Aquilex Holdings, LLC, 11.125%, 12/15/2016 144A		450,000		468,000
Arch Coal, Inc., 8.75%, 08/01/2016 144A		105,000		111,825
Atlas Energy Resources, LLC, 12.125%, 08/01/2017		890,000		1,005,700
Bill Barrett Corp., 9.875%, 07/15/2016		480,000		516,000
Chesapeake Energy Corp.:
6.875%, 01/15/2016		435,000		428,475
7.50%, 09/15/2013		8,500,000		8,627,500
9.50%, 02/15/2015		2,790,000		3,041,100
El Paso Corp.:
7.00%, 06/15/2017		95,000		97,129
7.42%, 02/15/2037		2,960,000		2,621,133
8.25%, 02/15/2016		1,165,000		1,255,287
12.00%, 12/12/2013		815,000		969,850

EVERGREEN INCOME ADVANTAGE FUND SCHEDULE OF INVESTMENTS continued



January 31, 2010 (unaudited)
	Principal Amount		Value


CORPORATE BONDS continued
ENERGY continued
Oil, Gas & Consumable Fuels continued
Exco Resources, Inc., 7.25%, 01/15/2011	$	6,281,000	$	6,281,000
Ferrellgas Partners, LP:
8.75%, 06/15/2012		975,000		977,438
9.125%, 10/01/2017 144A		620,000		658,750
Forest Oil Corp.:
7.25%, 06/15/2019		1,870,000		1,879,350
8.50%, 02/15/2014		1,115,000		1,170,750
Frontier Oil Corp., 6.625%, 10/01/2011		155,000		155,000
Holly Corp., 9.875%, 06/15/2017 144A		3,640,000		3,858,400
Murray Energy Corp., 10.25%, 10/15/2015 144A		1,535,000		1,561,862
Newfield Exploration Co.:
6.625%, 04/15/2016		50,000		50,000
6.875%, 02/01/2020		1,795,000		1,790,512
7.125%, 05/15/2018		165,000		167,063
Nustar Logistics, LP, 7.65%, 04/15/2018		75,000		84,937
Peabody Energy Corp.:
5.875%, 04/15/2016		5,000		4,900
7.875%, 11/01/2026		7,165,000		7,397,862
Penn Virginia Corp., 10.375%, 06/15/2016		215,000		236,769
Petrohawk Energy Corp.:
7.875%, 06/01/2015		2,100,000		2,152,500
10.50%, 08/01/2014		1,065,000		1,176,825
Pioneer Natural Resources Co., 7.50%, 01/15/2020		2,200,000		2,222,000
Plains Exploration & Production Co., 8.625%, 10/15/2019		5,675,000		5,987,125
Range Resources Corp., 8.00%, 05/15/2019		130,000		138,450
Sabine Pass LNG, LP:
7.25%, 11/30/2013		2,340,000		2,187,900
7.50%, 11/30/2016		4,745,000		4,193,394
SandRidge Energy, Inc.:
8.00%, 06/01/2018 144A		125,000		124,375
8.75%, 01/15/2020 144A		3,550,000		3,656,500
Southwestern Energy Co., 7.50%, 02/01/2018		1,280,000		1,363,200
Stone Energy Corp., 8.625%, 02/01/2017		1,060,000		1,054,700
Tesoro Corp.:
6.50%, 06/01/2017		285,000		271,463
7.50%, 07/17/2012		2,235,000		2,196,759
9.75%, 06/01/2019		1,505,000		1,623,519
Williams Cos.:
7.50%, 01/15/2031		345,000		390,251
8.75%, 01/15/2020		165,000		212,025


				76,759,578


FINANCIALS 17.4%
Capital Markets 1.1%
E*TRADE Financial Corp.:
7.375%, 09/15/2013		805,000		774,813
12.50%, 11/30/2017		5,407,000		6,245,085


				7,019,898


Commercial Banks 0.9%
CapitalSource, Inc., 12.75%, 07/15/2014 144A		3,650,000		3,996,750
Discover Bank, 8.70%, 11/18/2019		1,245,000		1,359,718
Zions Bancorp, 7.75%, 09/23/2014		405,000		388,800


				5,745,268

EVERGREEN INCOME ADVANTAGE FUND SCHEDULE OF INVESTMENTS continued



January 31, 2010 (unaudited)
	Principal Amount		Value


CORPORATE BONDS continued
FINANCIALS continued
Consumer Finance 10.5%
Calpine Construction Finance Corp., 8.00%, 06/01/2016 144A	$	115,000	$	117,300
Cemex Finance, LLC, 9.50%, 12/14/2016 144A		895,000		910,663
CIT Group, Inc.:
7.00%, 05/01/2016		265,000		227,900
7.00%, 05/01/2017		1,050,000		895,125
Clearwire Communications Finance Corp., 12.00%, 12/01/2015 144A		5,430,000		5,511,450
Discover Financial Services, 10.25%, 07/15/2019		1,970,000		2,352,255
Ford Motor Credit Co., LLC:
8.70%, 10/01/2014		385,000		398,260
9.75%, 09/15/2010		5,377,000		5,547,881
9.875%, 08/10/2011		3,680,000		3,850,075
GMAC, LLC:
6.75%, 12/01/2014		2,344,000		2,279,540
6.875%, 09/15/2011		3,690,000		3,690,000
6.875%, 08/28/2012		4,327,000		4,294,547
7.00%, 02/01/2012		167,000		165,748
7.50%, 12/31/2013		6,855,000		6,820,725
8.00%, 12/31/2018		5,122,000		4,840,290
8.00%, 11/01/2031		2,285,000		2,178,980
Homer City Funding, LLC, 8.73%, 10/01/2026		2,175,576		2,153,820
International Lease Finance Corp.:
4.75%, 01/13/2012		1,560,000		1,376,480
4.875%, 09/01/2010		1,190,000		1,160,013
5.125%, 11/01/2010		155,000		150,522
JBS USA Finance, Inc., 11.625%, 05/01/2014 144A		6,690,000		7,526,250
Level 3 Financing, Inc., 10.00%, 02/01/2018 144A		780,000		729,300
Nielsen Financial LLC:
11.50%, 05/01/2016		235,000		263,200
Sr. Disc. Note, Step Bond, 0.00%, 08/01/2016 †		105,000		96,075
NII Capital Corp., 10.00%, 08/15/2016 144A		155,000		161,975
NiSource Finance Corp., 10.75%, 03/15/2016		30,000		38,367
Pinnacle Foods Finance, LLC:
9.25%, 04/01/2015 144A		1,395,000		1,415,925
10.625%, 04/01/2017		820,000		846,650
Sprint Capital Corp.:
6.875%, 11/15/2028		6,450,000		5,063,250
8.375%, 03/15/2012		3,998,000		4,067,965


				69,130,531


Diversified Financial Services 1.3%
Leucadia National Corp.:
7.00%, 08/15/2013		185,000		188,237
8.125%, 09/15/2015		8,040,000		8,220,900


				8,409,137


Real Estate Investment Trusts (REITs) 3.1%
Dupont Fabros Technology, Inc., 8.50%, 12/15/2017 144A		7,810,000		8,005,250
Host Marriott Corp.:
7.125%, 11/01/2013		1,670,000		1,682,525
9.00%, 05/15/2017 144A		490,000		524,300
Omega Healthcare Investors, Inc., 7.00%, 04/01/2014		3,675,000		3,684,187
Ventas, Inc.:
6.75%, 04/01/2017		2,485,000		2,435,300
7.125%, 06/01/2015		2,516,000		2,541,160
9.00%, 05/01/2012		1,435,000		1,503,163


				20,375,885

EVERGREEN INCOME ADVANTAGE FUND SCHEDULE OF INVESTMENTS continued



January 31, 2010 (unaudited)
	Principal Amount		Value


CORPORATE BONDS continued
FINANCIALS continued
Real Estate Management & Development 0.0%
Icahn Enterprises, LP:
7.75%, 01/15/2016 144A	$	40,000	$	38,100
8.00%, 01/15/2018 144A		125,000		119,063


				157,163


Thrifts & Mortgage Finance 0.5%
Residential Capital, LLC, 8.50%, 05/15/2010		3,210,000		3,185,925


HEALTH CARE 4.6%
Biotechnology 0.2%
Talecris Biotherapeutics Holdings Corp., 7.75%, 11/15/2016 144A		1,125,000		1,153,125


Health Care Equipment & Supplies 0.2%
Biomet, Inc.:
10.375%, 10/15/2017 @		675,000		735,750
11.625%, 10/15/2017		340,000		374,000
Boston Scientific Corp., 6.00%, 01/15/2020		250,000		252,724
Universal Hospital Services, Inc., 8.50%, 06/01/2015 @		189,000		184,747


				1,547,221


Health Care Providers & Services 3.8%
Apria Healthcare Group, 11.25%, 11/01/2014 144A		1,810,000		1,936,700
HCA, Inc.:
6.30%, 10/01/2012		920,000		903,900
7.875%, 02/01/2011		1,830,000		1,880,325
7.875%, 02/15/2020 144A		205,000		210,638
8.50%, 04/15/2019 144A		4,525,000		4,785,187
8.75%, 09/01/2010		2,165,000		2,208,300
9.25%, 11/15/2016		5,070,000		5,348,850
9.625%, 11/15/2016 @		3,732,000		3,955,920
Omnicare, Inc., 6.125%, 06/01/2013		1,475,000		1,452,875
Prospect Medical Holdings, Inc., 12.75%, 07/15/2014		1,295,000		1,395,363
Symbion, Inc., 11.75%, 08/23/2015 @		833,908		667,126


				24,745,184


Life Sciences Tools & Services 0.4%
Bio-Rad Laboratories, Inc., 8.00%, 09/15/2016 144A		2,820,000		2,925,750


INDUSTRIALS 13.4%
Aerospace & Defense 6.0%
Alliant Techsystems, Inc., 6.75%, 04/01/2016		3,880,000		3,870,300
DAE Aviation Holdings, Inc., 11.25%, 08/01/2015 144A		910,000		834,925
GenCorp, Inc., 9.50%, 08/15/2013		1,020,000		1,045,500
GeoEye, Inc., 9.625%, 10/01/2015 144A		400,000		408,000
Hexcel Corp., 6.75%, 02/01/2015		3,485,000		3,354,313
L-3 Communications Holdings, Inc.:
5.20%, 10/15/2019 144A		115,000		115,863
5.875%, 01/15/2015		16,585,000		16,792,312
6.375%, 10/15/2015		4,621,000		4,678,762
Spirit AeroSystems Holdings, Inc., 7.50%, 10/01/2017 144A		815,000		821,113
TransDigm Group, Inc., 7.75%, 07/15/2014 144A		810,000		818,100
Vought Aircraft Industries, Inc., 8.00%, 07/15/2011		6,675,000		6,624,937


				39,364,125


Airlines 0.3%
Delta Air Lines, Inc.:
9.50%, 09/15/2014 144A		255,000		265,837
12.25%, 03/15/2015 144A		125,000		129,688
United Airlines, Inc., 10.40%, 05/01/2018		1,390,000		1,487,300


				1,882,825

EVERGREEN INCOME ADVANTAGE FUND SCHEDULE OF INVESTMENTS continued



January 31, 2010 (unaudited)
	Principal Amount		Value


CORPORATE BONDS continued
INDUSTRIALS continued
Building Products 0.0%
Associated Materials, LLC, 9.875%, 11/15/2016 144A	$	125,000	$	132,500


Commercial Services & Supplies 3.3%
Allied Waste North America, Inc., 6.875%, 06/01/2017		200,000		216,000
Browning-Ferris Industries, Inc., 9.25%, 05/01/2021		2,760,000		3,331,491
Casella Waste Systems, Inc., 11.00%, 07/15/2014 144A		1,670,000		1,811,950
Cornell Companies, Inc., 10.75%, 07/01/2012		295,000		300,900
Corrections Corporation of America:
6.25%, 03/15/2013		2,905,000		2,912,262
6.75%, 01/31/2014		1,120,000		1,122,800
7.75%, 06/01/2017		3,205,000		3,293,137
DigitalGlobe, Inc., 10.50%, 05/01/2014 144A		455,000		489,125
Geo Group, Inc., 7.75%, 10/15/2017 144A		2,025,000		2,065,500
Interface, Inc., Class A, 11.375%, 11/01/2013		550,000		621,500
Iron Mountain, Inc.:
6.625%, 01/01/2016		100,000		97,000
7.75%, 01/15/2015		315,000		317,363
8.375%, 08/15/2021		2,725,000		2,827,188
SGS International, Inc., 12.00%, 12/15/2013		2,000,000		2,095,000
Toll Corp., 8.91%, 10/15/2017		250,000		287,562


				21,788,778


Industrial Conglomerates 0.6%
Otter Tail Corp., 9.00%, 12/15/2016		3,985,000		4,154,362


Machinery 1.3%
Commercial Vehicle Group, Inc., 13.00%, 02/15/2013 144A @		7,335,000		6,601,500
CPM Holdings, Inc., 10.625%, 09/01/2014 144A		1,320,000		1,405,800
Navistar International Corp., 8.25%, 11/01/2021		235,000		237,350


				8,244,650


Road & Rail 1.7%
Kansas City Southern:
8.00%, 06/01/2015		8,285,000		8,523,194
13.00%, 12/15/2013		1,655,000		1,936,350
Swift Transportation Co., Inc.:
8.02%, 05/15/2015 144A		205,000		175,275
12.50%, 05/15/2017 144A		205,000		184,500


				10,819,319


Trading Companies & Distributors 0.0%
RSC Equipment Rental, Inc., 10.00%, 07/15/2017 144A		155,000		168,563


Transportation 0.2%
United Maritime Group, 11.75%, 06/15/2015 144A		1,250,000		1,259,375


INFORMATION TECHNOLOGY 7.5%
Communications Equipment 0.8%
Brocade Communications Systems, Inc., 6.625%, 01/15/2018 144A		1,415,000		1,432,687
EchoStar Corp.:
7.125%, 02/01/2016		585,000		586,463
7.75%, 05/31/2015		100,000		103,000
Lucent Technologies, Inc., 6.45%, 03/15/2029		4,010,000		2,817,025


				4,939,175


Electronic Equipment, Instruments & Components 4.1%
Anixter International, Inc., 10.00%, 03/15/2014		3,225,000		3,559,594
Da-Lite Screen Co., Inc., 9.50%, 05/15/2011		3,925,000		3,905,375
Intcomex, Inc., 13.25%, 12/15/2014 144A		2,440,000		2,409,500
Jabil Circuit, Inc., 8.25%, 03/15/2018		12,082,000		13,139,175

EVERGREEN INCOME ADVANTAGE FUND SCHEDULE OF INVESTMENTS continued



January 31, 2010 (unaudited)
	Principal Amount		Value


CORPORATE BONDS continued
INFORMATION TECHNOLOGY continued
Electronic Equipment, Instruments & Components continued
Sanmina-SCI Corp., 8.125%, 03/01/2016	$	1,090,000	$	1,092,725
Viasystem Group, Inc., 12.00%, 01/15/2015 144A		2,495,000		2,694,600


				26,800,969


Internet Software & Services 0.4%
Terremark Worldwide, Inc., 12.00%, 06/15/2017 144A		2,605,000		2,885,037


IT Services 1.9%
First Data Corp.:
9.875%, 09/24/2015		1,380,000		1,231,650
10.55%, 09/24/2015		11,335,398		9,635,088
iPayment, Inc., 9.75%, 05/15/2014		1,945,000		1,648,388


				12,515,126


Semiconductors & Semiconductor Equipment 0.2%
Advanced Micro Devices, Inc., 5.75%, 08/15/2012		1,025,000		1,007,062
Spansion, Inc., 11.25%, 01/15/2016 144A •		205,000		246,000


				1,253,062


Software 0.1%
Activant Solutions, Inc., 9.50%, 05/01/2016		60,000		57,450
JDA Software Group, Inc., 8.00%, 12/15/2014 144A		420,000		434,175


				491,625


MATERIALS 4.9%
Chemicals 0.4%
Ashland, Inc., 9.125%, 06/01/2017 144A		230,000		250,700
Huntsman International, LLC, 5.50%, 06/30/2016 144A		1,320,000		1,151,700
Koppers Holdings, Inc., 7.875%, 12/01/2019 144A		220,000		224,400
MacDermid, Inc., 9.50%, 04/15/2017 144A		409,000		413,090
Nalco Holding Co., 8.25%, 05/15/2017 144A		120,000		127,200
SOLUTIA, Inc., 8.75%, 11/01/2017		110,000		116,325


				2,283,415


Construction Materials 1.1%
CPG International, Inc.:
10.50%, 07/01/2013		3,085,000		3,015,588
FRN, 7.18%, 07/01/2012		1,355,000		1,287,250
Headwaters, Inc., 11.375%, 11/01/2014 144A		1,735,000		1,821,750
Texas Industries, Inc., 7.25%, 07/15/2013		1,085,000		1,079,575


				7,204,163


Containers & Packaging 1.3%
Exopack Holding Corp., 11.25%, 02/01/2014		4,700,000		4,852,750
Graham Packaging Co., 8.25%, 01/01/2017 144A		2,045,000		2,014,325
Sealed Air Corp., 7.875%, 06/15/2017 144A		230,000		242,781
Silgan Holdings, Inc., 7.25%, 08/15/2016		990,000		1,027,125


				8,136,981


Metals & Mining 1.4%
AK Steel Corp., 7.75%, 06/15/2012		1,030,000		1,035,150
Edgen Murray Corp., 12.25%, 01/15/2015 144A		2,045,000		1,952,975
Freeport-McMoRan Copper & Gold, Inc.:
8.25%, 04/01/2015		110,000		119,075
8.375%, 04/01/2017		5,725,000		6,225,937
Indalex Holdings Corp., 11.50%, 02/01/2014 •		5,985,000		59,850


				9,392,987

EVERGREEN INCOME ADVANTAGE FUND SCHEDULE OF INVESTMENTS continued



January 31, 2010 (unaudited)
	Principal Amount		Value


CORPORATE BONDS continued
MATERIALS continued
Paper & Forest Products 0.7%
Clearwater Paper Corp., 10.625%, 06/15/2016 144A	$	1,175,000	$	1,304,250
Georgia Pacific Corp.:
8.125%, 05/15/2011		1,110,000		1,168,275
8.25%, 05/01/2016 144A		125,000		133,750
8.875%, 05/15/2031		495,000		530,888
Glatfelter, 7.125%, 05/01/2016		470,000		446,500
NewPage Corp., 11.375%, 12/31/2014		1,260,000		1,219,050


				4,802,713


TELECOMMUNICATION SERVICES 9.8%
Diversified Telecommunication Services 5.8%
Cincinnati Bell, Inc., 8.25%, 10/15/2017		2,070,000		2,075,175
Citizens Communications Co., 7.875%, 01/15/2027		3,625,000		3,289,687
FairPoint Communications, Inc., 13.125%, 04/01/2018 •		430,000		60,200
Frontier Communications Corp., 8.125%, 10/01/2018		3,255,000		3,279,412
Global Crossing, Ltd., 12.00%, 09/15/2015 144A		155,000		168,950
Qwest Corp.:
6.875%, 07/15/2028		576,000		495,360
7.125%, 04/01/2018 144A		1,220,000		1,189,500
7.125%, 11/15/2043		2,015,000		1,722,825
7.25%, 09/15/2025		2,755,000		2,644,800
7.50%, 06/15/2023		3,260,000		3,211,100
7.625%, 08/03/2021		440,000		404,800
8.00%, 10/01/2015 144A		15,000		15,525
8.875%, 03/15/2012		11,625,000		12,482,344
SBA Telecommunications, Inc.:
8.00%, 08/15/2016 144A		905,000		938,938
8.25%, 08/15/2019 144A		485,000		509,250
Sorenson Communications, Inc., 10.50%, 02/01/2015 144A		1,265,000		1,192,263
West Corp., 9.50%, 10/15/2014		115,000		115,575
Windstream Corp., 7.875%, 11/01/2017 144A		4,265,000		4,211,687


				38,007,391


Wireless Telecommunication Services 4.0%
CC Holdings GS V, LLC, 7.75%, 05/01/2017 144A		125,000		134,688
Cricket Communications, Inc.:
7.75%, 05/15/2016		2,285,000		2,299,281
9.375%, 11/01/2014		1,785,000		1,776,075
Crown Castle International Corp., 7.125%, 11/01/2019		165,000		163,763
iPCS, Inc., FRN, 4.28%, 05/01/2014 @		2,579,646		2,231,394
MetroPCS Communications, Inc., 9.25%, 11/01/2014		3,790,000		3,813,687
Sprint Nextel Corp.:
6.90%, 05/01/2019		4,925,000		4,383,250
Ser. D, 7.375%, 08/01/2015		5,000,000		4,512,500
Ser. F, 5.95%, 03/15/2014		7,940,000		7,026,900


				26,341,538


UTILITIES 11.7%
Electric Utilities 8.0%
Aquila, Inc., Step Bond, 11.875%, 07/01/2012 ††		17,244,000		20,273,443
CMS Energy Corp.:
8.50%, 04/15/2011		860,000		912,438
8.75%, 06/15/2019		135,000		153,915
Edison Mission Energy:
7.00%, 05/15/2017		140,000		110,600
7.20%, 05/15/2019		1,645,000		1,274,875

EVERGREEN INCOME ADVANTAGE FUND SCHEDULE OF INVESTMENTS continued



January 31, 2010 (unaudited)
	Principal Amount		Value


CORPORATE BONDS continued
UTILITIES continued
Electric Utilities continued
Energy Future Holdings Corp.:
10.00%, 01/15/2020 144A	$	1,645,000	$	1,682,013
FRN, 12.00%, 11/01/2017 @		4,269,044		3,137,747
Mirant Americas Generation, LLC, 8.50%, 10/01/2021		510,000		489,600
Mirant Mid-Atlantic, LLC, Ser. C, 10.06%, 12/30/2028		7,560,525		8,127,564
Mirant North America, LLC, 7.375%, 12/31/2013		3,255,000		3,238,725
NRG Energy, Inc.:
7.25%, 02/01/2014		1,240,000		1,244,650
8.50%, 06/15/2019		2,725,000		2,738,625
Orion Power Holdings, Inc., 12.00%, 05/01/2010		8,385,000		8,489,812
Public Service Company of New Mexico, 7.95%, 04/01/2015		285,000		301,224


				52,175,231


Independent Power Producers & Energy Traders 3.5%
AES Corp.:
8.00%, 06/01/2020		105,000		105,262
8.875%, 02/15/2011		2,045,000		2,126,800
Dynegy Holdings, Inc.:
6.875%, 04/01/2011		2,135,000		2,209,725
7.625%, 10/15/2026		5,110,000		3,883,600
Reliant Energy, Inc.:
6.75%, 12/15/2014		8,596,000		8,767,920
7.625%, 06/15/2014		2,945,000		2,827,200
7.875%, 06/15/2017		75,000		71,438
9.24%, 07/02/2017		2,540,115		2,711,573
9.68%, 07/02/2026		300,000		319,500


				23,023,018


Multi-Utilities 0.2%
Ameren Corp., 8.875%, 05/15/2014		230,000		267,243
PNM Resources, Inc., 9.25%, 05/15/2015		1,145,000		1,229,444


				1,496,687


Total Corporate Bonds (cost $685,317,647)				704,854,558


U.S. TREASURY OBLIGATIONS 0.2%
U.S. Treasury Note, 4.375%, 11/15/2039 (cost $1,187,464)		1,240,000		1,212,875


YANKEE OBLIGATIONS – CORPORATE 6.2%
CONSUMER DISCRETIONARY 0.1%
Hotels, Restaurants & Leisure 0.0%
Norwegian Cruise Line, Ltd., 11.75%, 11/15/2016 144A		125,000		132,500
Royal Caribbean Cruises, Ltd., 11.875%, 07/15/2015		90,000		105,075


				237,575


Media 0.1%
UPC Germany GmbH, 8.125%, 12/01/2017 144A		500,000		515,435
UPC Holdings BV, 9.875%, 04/15/2018 144A		35,000		37,012
Videotron, Ltd., 9.125%, 04/15/2018 144A		145,000		155,875


				708,322


CONSUMER STAPLES 0.0%
Food & Staples Retailing 0.0%
Minerva Overseas, Ltd., 10.875%, 11/15/2019 144A		150,000		152,825


ENERGY 1.1%
Oil, Gas & Consumable Fuels 1.1%
Connacher Oil & Gas, Ltd.:
10.25%, 12/15/2015 144A		1,295,000		1,243,200
11.75%, 07/15/2014 144A		360,000		396,000

EVERGREEN INCOME ADVANTAGE FUND SCHEDULE OF INVESTMENTS continued



January 31, 2010 (unaudited)
	Principal Amount		Value


YANKEE OBLIGATIONS – CORPORATE continued
ENERGY continued
Oil, Gas & Consumable Fuels continued
Griffin Coal Mining Co., Ltd., 9.50%, 12/01/2016 144A •	$	5,906,000	$	3,071,120
OPTI Canada, Inc.:
7.875%, 12/15/2014		1,115,000		967,263
8.25%, 12/15/2014		1,065,000		937,200
P2021 Rig Co., 13.50%, 12/15/2013 144A		575,000		586,500


				7,201,283


FINANCIALS 1.4%
Consumer Finance 0.4%
Petroplus Finance, Ltd., 6.75%, 05/01/2014 144A		15,000		13,875
Wind Acquisition Finance SA, 11.75%, 07/15/2017 144A		2,360,000		2,566,500


				2,580,375


Diversified Financial Services 1.0%
FMG Finance Property, Ltd.:
10.625%, 09/01/2016 144A		3,891,500		4,407,124
FRN, 4.26%, 09/01/2011 144A		350,000		343,000
Manchester United Finance plc, 8.375%, 02/01/2017 144A		165,000		159,271
Preferred Term Securities XII, Ltd., FRN, 0.95%, 12/24/2033 • +		1,540,000		9,702
Ship Finance International, Ltd., 8.50%, 12/15/2013		1,595,000		1,557,119


				6,476,216


HEALTH CARE 0.0%
Pharmaceuticals 0.0%
Elan Corporation plc, 8.75%, 10/15/2016 144A		55,000		54,244


INDUSTRIALS 1.0%
Road & Rail 1.0%
Kansas City Southern de Mexico:
7.375%, 06/01/2014		5,484,000		5,401,740
8.00%, 02/01/2018 144A		500,000		493,745
12.50%, 04/01/2016		535,000		625,281


				6,520,766


Transportation Infrastructure 0.0%
Navios Maritime Holdings, Inc., 8.875%, 11/01/2017 144A		100,000		103,500


MATERIALS 1.4%
Chemicals 0.1%
NOVA Chemicals Corp.:
8.375%, 11/01/2016 144A		300,000		301,875
8.625%, 11/01/2019 144A		375,000		378,281


				680,156


Metals & Mining 0.8%
Evraz Group SA, 8.875%, 04/24/2013		1,350,000		1,383,750
Novelis, Inc., 7.25%, 02/15/2015		1,010,000		956,975
Vedanta Resources plc, 9.50%, 07/18/2018		2,500,000		2,656,250


				4,996,975


Paper & Forest Products 0.5%
PE Paper Escrow GmbH, 12.00%, 08/01/2014 144A		500,000		552,500
Sappi, Ltd.:
6.75%, 06/15/2012 144A		1,195,000		1,159,150
7.50%, 06/15/2032 144A		2,188,000		1,476,900


				3,188,550

EVERGREEN INCOME ADVANTAGE FUND SCHEDULE OF INVESTMENTS continued



January 31, 2010 (unaudited)
	Principal Amount		Value


YANKEE OBLIGATIONS – CORPORATE continued
TELECOMMUNICATION SERVICES 1.2%
Wireless Telecommunication Services 1.2%
Digicel Group, Ltd.:
8.25%, 09/01/2017 144A	$	755,000	$	732,350
12.00%, 04/01/2014 144A		455,000		505,050
Intelsat, Ltd.:
8.50%, 01/15/2013		4,155,000		4,196,550
8.875%, 01/15/2015 144A		205,000		209,100
11.25%, 06/15/2016		250,000		265,625
Millicom International Cellular SA, 10.00%, 12/01/2013		190,000		196,175
Telesat Canada, Inc., 11.00%, 11/01/2015		615,000		687,262
Vimpel Communications, 9.125%, 04/30/2018 144A		800,000		864,000


				7,656,112


Total Yankee Obligations – Corporate (cost $37,134,215)				40,556,899


CONVERTIBLE DEBENTURES 0.2%
INFORMATION TECHNOLOGY 0.2%
Communications Equipment 0.2%
Lucent Technologies, Inc., 2.875%, 06/15/2025 (cost $585,815)		1,225,000		1,053,500





	Shares		Value


CLOSED END MUTUAL FUND SHARES 0.8%
Dreyfus High Yield Strategies Fund, Inc.		411,242		1,550,382
Eaton Vance Limited Duration Income Trust		99,227		1,531,073
ING Prime Rate Trust		22,959		131,785
LMP Corporate Loan Fund, Inc.		30,704		320,857
New America High Income Fund, Inc.		170,560		1,543,568


Total Closed End Mutual Fund Shares (cost $2,973,492)				5,077,665




	Principal Amount		Value


LOANS 9.4%
CONSUMER DISCRETIONARY 3.2%
Abitibi Consolidated, Inc., FRN, 11.00%, 03/30/2010	$	500,000		465,000
Ford Motor Co., FRN, 3.24%-3.26%, 12/15/2013		1,167,664		1,097,791
Metaldyne Corp., FRN, 13.00%, 04/09/2014		5,020,000		5,195,198
MGM Mirage, FRN, 6.00%, 10/03/2011		1,593,253		1,534,063
Newsday, LLC, 10.50%, 07/15/2013		5,920,000		6,311,430
Sugarhouse HSP Gaming Properties, LP, FRN, 11.25%, 09/11/2014		2,375,000		2,362,175
Tower Automotive Holdings, FRN, 4.50%-4.56%, 07/31/2013		960,357		384,143
Tropicana Entertainment, LLC, 2.73%, 01/03/2012 •		3,645,000		1,111,761
Universal City Development, Ltd, 7.75%, 10/29/2014		2,635,000		2,638,584


				21,100,145


CONSUMER STAPLES 0.9%
Merisant Co., FRN, 7.50%, 01/08/2014		6,242,379		6,053,422


ENERGY 1.3%
Saint Acquisition Corp., FRN, 8.25%, 06/05/2014		3,334,396		3,199,586
Semgroup Energy Partners, FRN, 9.50%, 07/20/2012		5,385,000		5,381,123


				8,580,709


FINANCIALS 0.7%
CIT Group, Inc., FRN, 12.25%, 01/18/2012		1,635,000		1,690,443
Realogy Corp., FRN:
3.23%, 09/01/2014		653,250		580,374
3.25%, 09/01/2014		2,426,359		2,155,674


				4,426,491

EVERGREEN INCOME ADVANTAGE FUND SCHEDULE OF INVESTMENTS continued



January 31, 2010 (unaudited)
	Principal Amount		Value


LOANS continued
HEALTH CARE 0.3%
HCA, Inc., FRN, 1.75%, 11/18/2012	$	1,911,317	$	1,803,232


INDUSTRIALS 1.1%
Commercial Vehicle Group, Inc., 15.00%, 02/15/2013		4,051,992		3,889,386
Neff Corp., FRN:
3.75%, 11/30/2014		12,345,000		2,407,275
3.75%, 05/31/2013		1,152,250		956,874


				7,253,535


MATERIALS 1.3%
LyondellBasell, FRN:
3.73%, 12/20/2013		463,760		340,090
3.98%, 12/22/2014		282,111		206,872
5.79%-6.56%, 04/06/2010		3,877,126		4,071,021
7.00%, 12/20/2013		1,224,162		897,678
13.00%, 04/06/2010		2,808,904		2,942,355


				8,458,016


TELECOMMUNICATION SERVICES 0.4%
FairPoint Communications, Inc., FRN, 2.75%, 03/08/2015 •		3,602,499		2,793,306


UTILITIES 0.2%
Scorpion Holding Co., Ltd., FRN, 7.73%, 05/08/2014		1,235,000		1,164,321


Total Loans (cost $66,415,707)				61,633,177




	Shares		Value


SHORT-TERM INVESTMENTS 6.2%
MUTUAL FUND SHARES 6.2%
Evergreen Institutional Money Market Fund, Class I, 0.01% q ø ## (cost $40,786,931)		40,786,931		40,786,931


Total Investments (cost $834,401,271) 130.7%				855,175,605
Other Assets and Liabilities and Preferred Shares (30.7%)				(201,083,149	)


Net Assets Applicable to Common Shareholders 100.0%			$	654,092,456

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, unless otherwise noted.
•	Security which has defaulted on payment of interest and/or principal.
+	Security is deemed illiquid.
††	The rate shown is the stated rate at the current period end.
@	Security is currently paying interest in-kind.
†	Security initially issued in zero coupon form which converts to coupon form at a specified rate and date. An effective interest rate is applied to recognize interest income daily for the bond. This rate is based on total expected interest to be earned over the life of the bond which consists of the aggregate coupon-interest payments and discount at acquisition. The rate shown is the stated rate at the current period end.
q	Rate shown is the 7-day annualized yield at period end.
ø	Evergreen Investment Management Company, LLC is the investment advisor to both the Fund and the money market fund.
##	All or a portion of this security has been segregated for when-issued, delayed delivery securities and/or unfunded loans.

Summary of Abbreviations
FRN	Floating Rate Note

EVERGREEN INCOME ADVANTAGE FUND SCHEDULE OF INVESTMENTS continued



January 31, 2010 (unaudited)

The Fund enters into credit default swap contracts as a substitute for taking a position in the underlying security or basket of securities or to potentially enhance the Fund’s total return. At January 31, 2010, the Fund had the following credit default swap contracts outstanding:

Credit default swaps on debt obligations – Sell protection

Rating of

Fixed

Frequency

Upfront

Reference

Payments

Premiums

Debt

Notional

Received

Payments

Market

Paid/

Unrealized

Expiration

Counterparty

Obligation

Obligation*

Amount

by the Fund

Received

Value

(Received)

Gain (Loss)

06/20/2014

Goldman Sachs

Expedia, 7.46%,
08/15/2018 #

BBB-

970,000

5.00%

Quarterly

(161,798)

(78,056)

(83,742)

06/20/2014

UBS

Expedia, 7.46%,
08/15/2018 #

BBB-

1,670,000

5.00%

Quarterly

(278,559)

(44,766)

(233,793)

*	Reflects the ratings of a nationally recognized ratings agency at period end. A rating of D would most likely indicate a trigger event of default has occurred although circumstances including bankruptcy, failure to pay, obligation default, obligation acceleration, repudiation/moratorium and restructuring may also cause a credit event to take place.
#	The Fund entered into the swap contract for speculative purposes.

The Fund had an average notional balance on credit default swaps of $9,540,598, during the period from May 01, 2009 to January 31, 2010.

On January 31, 2010, the aggregate cost of securities for federal income tax purposes was $842,336,166. The gross unrealized appreciation and depreciation on securities based on tax cost was $48,710,524 and $35,871,085, respectively, with a net unrealized appreciation of $12,839,439.

Valuation of investments

Portfolio debt securities acquired with more than 60 days to maturity are fair valued using matrix pricing methods determined by 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 readily available from an independent pricing service may be valued by brokers which use prices provided by market makers or estimates of fair market value obtained from yield data relating to investments or securities with similar characteristics.

Listed equity securities are usually valued at the last sales price or official closing price on the national securities exchange where the securities are principally traded. If there has been no sale, the securities are valued at the mean between bid and asked prices.

Investments in open-end mutual funds are valued at net asset value. Securities for which market quotations are not readily available or not reflective of current fair value are valued at fair value as determined by the investment advisor in good faith, according to procedures approved by the Board of Trustees.

The valuation techniques used by the Fund to measure fair value are consistent with the market approach, income approach and/or cost approach, where applicable, for each security type.

When-issued and delayed delivery transactions

The Fund records when-issued or delayed delivery securities as of trade date and maintains 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.

Credit default swaps

The Fund is subject to credit risk in the normal course of pursuing its investment objectives. The Fund may enter into credit default swap contracts for hedging or speculative purposes to provide or receive a measure of protection against default on a referenced entity, obligation or index or for investment gains. Credit default swaps involve an exchange of a stream of payments for protection against the loss in value of an underlying security or index. Under the terms of the swap, one party acts as a guarantor (referred to as the seller of protection) and receives a periodic stream of payments, provided that there is no credit event, from another party (referred to as the buyer of protection) that is a fixed percentage applied to a notional principal amount over the term of the swap. An index credit default swap references all the names in the index, and if a credit event is triggered, the credit event is settled based on that name’s weight in the index. A credit event includes bankruptcy, failure to pay, obligation default, obligation acceleration, repudiation/moratorium, and restructuring. The Fund may enter into credit default swaps as either the seller of protection or the buyer of protection. As the seller of protection, the Fund is subject to investment exposure on the notional amount of the swap and has assumed the risk of default of the underlying security or index. As the buyer of protection, the Fund could be exposed to risks if the seller of the protection defaults on its obligation to perform, or if there are unfavorable changes in the fluctuation of interest rates or in the price of the underlying security or index. The maximum potential amount of future payments (undiscounted) that the Fund as the seller of protection could be required to make under the credit default swap contract would be an amount equal to the notional amount of the swap contract. The Fund’s maximum risk of loss from counterparty risk, either as the protection seller or as the protection buyer, is the fair value of the contract. This risk is mitigated by having a master netting arrangement between the Fund and the counterparty and by having the counterparty post collateral to cover the Fund’s exposure to the counterparty.

If the Fund is the seller of protection and a credit event occurs, as defined under the terms of that particular swap agreement, the Fund will pay to the buyer of protection the notional amount of the swap and take delivery of the referenced obligation or underlying securities comprising the referenced index. If the Fund is the buyer of protection and a credit event occurs, as defined under the terms of that particular swap agreement, the Fund will receive from the seller of protection the notional amount of the swap and deliver the referenced obligation or underlying securities comprising the referenced index.

Any premiums paid or received on the transactions are recorded as an asset or liability on the Statement of Assets and Liabilities and amortized. The value of the swap contract is marked-to-market daily based on quotations from an independent pricing service or market makers and any change in value is recorded as an unrealized gain or loss. Periodic payments made or received are recorded as realized gains or losses. In addition, payments received or made as a result of a credit event or termination of the contract are recognized as realized gains or losses.

EVERGREEN INCOME ADVANTAGE FUND SCHEDULE OF INVESTMENTS continued



January 31, 2010 (unaudited)

Certain credit default swap contracts entered into by the Fund provide for conditions that result in events of default or termination that enable the counterparty to the agreement to cause an early termination of the transactions under those agreements. Any election by the counterparty to terminate early may impact the amounts reported on the financial statements.

Valuation hierarchy

Fair value measurements of investments are determined within a framework that has established a fair value hierarchy based upon the various data inputs utilized in determining the value of the Fund’s investments. These inputs are summarized into three broad levels as follows:

Level 1 – quoted prices in active markets for identical securities

Level 2 – other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.)

Level 3 – significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of investments)

The inputs or methodologies used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.

As of January 31, 2010, the inputs used in valuing the Fund’s assets, which are carried at fair value, were as follows:

Investments in Securities	Quoted Prices (Level 1)		Significant Other Observable Inputs (Level 2)			Significant Unobservable Inputs (Level 3)			Total



Equity securities
Closed end-mutual fund shares	$	5,077,665		$	0		$	0	$	5,077,665
Corporate debt securities		0			745,737,218			727,739		746,464,957
Debt securities issued by U.S. Treasury and U.S. government agencies		1,212,875			0			0		1,212,875
Loans		0			38,031,521			23,601,656		61,633,177
Short-term investments		40,786,931			0			0		40,786,931



	$	47,077,471		$	783,768,739		$	24,329,395	$	855,175,605

As of January 31, 2010, the inputs used in valuing the Fund’s other financial instruments, which are carried at fair value, were as follows:

	Quoted Prices (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total



Other financial instruments*		$0		$(440,357)		$0		$(440,357)

*	Other financial instruments include swap contracts.

The following is a reconciliation of assets in which significant unobservable inputs (Level 3) were used in determining fair value:

	Corporate debt securities		Loans		Total



Balance as of May 1, 2009	$	0	$	0	$	0
Realized gains or losses		0		0		0
Change in unrealized gains or losses		0		0		0
Net purchases (sales)		0		0		0
Transfers in and/or out of Level 3		727,739		23,601,656		24,329,395



Balance as of January 31, 2010	$	727,739	$	23,601,656	$	24,329,395



Change in unrealized gains or losses included in earnings relating to securities still held at January 31, 2010	$	0	$	0	$	0

Item 2 - Controls and Procedures

(a)

The registrant’s principal executive officer and principal financial officer have evaluated the registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) within 90 days of this filing and have concluded that the registrant’s disclosure controls and procedures were effective, as of that date, in ensuring that information required to be disclosed by the registrant in this Form N-Q was recorded, processed, summarized, and reported timely.

(b)

There has been no change in the registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) that occurred during the registrant’s last fiscal quarter that has materially affected, or is reasonable likely to materially affect, the registrant’s internal control over financial reporting.

Item 3 - Exhibits

File the exhibits listed below as part of this Form. Letter or number the exhibits in the sequence indicated.

(a)	Separate certifications for the registrant’s principal executive officer and principal financial officer, as required by Rule 30a-2(a) under the Investment Company Act of 1940, are attached as EX-99.CERT.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Evergreen Income Advantage Fund

By:	/s/ W. Douglas Munn
	W. Douglas Munn Principal Executive Officer

Date: March 31, 2010

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

By:	/s/ W. Douglas Munn
	W. Douglas Munn Principal Executive Officer

Date: March 31, 2010

By:	/s/ Kasey Phillips
	Kasey Phillips Principal Financial Officer

Date: March 31, 2010