In window -> preferences -> server -> runtime environment -> default classpath:

click any as7-style server from combo, see following text:

!ENTRY org.eclipse.ui 4 0 2014-04-11 17:34:47.013
!MESSAGE Unhandled event loop exception
!STACK 0
org.jboss.tools.foundation.core.expressions.ExpressionResolutionException: org.eclipse.core.runtime.CoreException: Error while evaluating variable jboss_server_home.
at org.jboss.ide.eclipse.as.core.resolvers.RuntimeVariableResolver.resolve(RuntimeVariableResolver.java:77)
at org.jboss.tools.foundation.core.expressions.ExpressionResolver.resolveVariable(ExpressionResolver.java:304)
at org.jboss.tools.foundation.core.expressions.ExpressionResolver.resolve(ExpressionResolver.java:229)
at org.jboss.ide.eclipse.archives.webtools.filesets.Fileset.getFolder(Fileset.java:71)
at org.jboss.ide.eclipse.archives.webtools.filesets.Fileset.equals(Fileset.java:193)
at org.eclipse.jface.viewers.StructuredViewer.equals(StructuredViewer.java:733)
at org.eclipse.jface.viewers.AbstractTreeViewer.updateChildren(AbstractTreeViewer.java:2752)
at org.eclipse.jface.viewers.AbstractTreeViewer.internalRefreshStruct(AbstractTreeViewer.java:1944)
at org.eclipse.jface.viewers.TreeViewer.internalRefreshStruct(TreeViewer.java:752)
at org.eclipse.jface.viewers.AbstractTreeViewer.internalRefresh(AbstractTreeViewer.java:1919)
at org.eclipse.jface.viewers.AbstractTreeViewer.internalRefresh(AbstractTreeViewer.java:1876)
at org.eclipse.jface.viewers.AbstractTreeViewer.internalRefresh(AbstractTreeViewer.java:1861)
at org.eclipse.jface.viewers.StructuredViewer$7.run(StructuredViewer.java:1527)
at org.eclipse.jface.viewers.StructuredViewer.preservingSelection(StructuredViewer.java:1460)
at org.eclipse.jface.viewers.TreeViewer.preservingSelection(TreeViewer.java:428)
at org.eclipse.jface.viewers.StructuredViewer.preservingSelection(StructuredViewer.java:1421)
at org.eclipse.jface.viewers.StructuredViewer.refresh(StructuredViewer.java:1524)
at org.eclipse.jface.viewers.ColumnViewer.refresh(ColumnViewer.java:556)
at org.eclipse.jface.viewers.StructuredViewer.refresh(StructuredViewer.java:1483)
at org.jboss.ide.eclipse.as.ui.preferences.ServerTypePreferencePage$AbstractComboDataPreferenceComposite$2.widgetSelected(ServerTypePreferencePage.java:129)
at org.eclipse.swt.widgets.TypedListener.handleEvent(TypedListener.java:248)
at org.eclipse.swt.widgets.EventTable.sendEvent(EventTable.java:84)
at org.eclipse.swt.widgets.Display.sendEvent(Display.java:4425)
at org.eclipse.swt.widgets.Widget.sendEvent(Widget.java:1388)
at org.eclipse.swt.widgets.Display.runDeferredEvents(Display.java:3773)
at org.eclipse.swt.widgets.Display.readAndDispatch(Display.java:3393)
at org.eclipse.jface.window.Window.runEventLoop(Window.java:832)
at org.eclipse.jface.window.Window.open(Window.java:808)
at org.eclipse.ui.internal.dialogs.WorkbenchPreferenceDialog.open(WorkbenchPreferenceDialog.java:215)
at org.eclipse.ui.internal.OpenPreferencesAction.run(OpenPreferencesAction.java:65)
at org.eclipse.jface.action.Action.runWithEvent(Action.java:519)
at org.eclipse.jface.action.ActionContributionItem.handleWidgetSelection(ActionContributionItem.java:595)
at org.eclipse.jface.action.ActionContributionItem.access$2(ActionContributionItem.java:511)
at org.eclipse.jface.action.ActionContributionItem$5.handleEvent(ActionContributionItem.java:420)
at org.eclipse.swt.widgets.EventTable.sendEvent(EventTable.java:84)
at org.eclipse.swt.widgets.Display.sendEvent(Display.java:4425)
at org.eclipse.swt.widgets.Widget.sendEvent(Widget.java:1388)
at org.eclipse.swt.widgets.Display.runDeferredEvents(Display.java:3773)
at org.eclipse.swt.widgets.Display.readAndDispatch(Display.java:3393)
at org.eclipse.e4.ui.internal.workbench.swt.PartRenderingEngine$9.run(PartRenderingEngine.java:1122)
at org.eclipse.core.databinding.observable.Realm.runWithDefault(Realm.java:332)
at org.eclipse.e4.ui.internal.workbench.swt.PartRenderingEngine.run(PartRenderingEngine.java:1006)
at org.eclipse.e4.ui.internal.workbench.E4Workbench.createAndRunUI(E4Workbench.java:147)
at org.eclipse.ui.internal.Workbench$5.run(Workbench.java:630)
at org.eclipse.core.databinding.observable.Realm.runWithDefault(Realm.java:332)
at org.eclipse.ui.internal.Workbench.createAndRunWorkbench(Workbench.java:574)
at org.eclipse.ui.PlatformUI.createAndRunWorkbench(PlatformUI.java:150)
at org.eclipse.ui.internal.ide.application.IDEApplication.start(IDEApplication.java:125)
at org.eclipse.equinox.internal.app.EclipseAppHandle.run(EclipseAppHandle.java:196)
at org.eclipse.core.runtime.internal.adaptor.EclipseAppLauncher.runApplication(EclipseAppLauncher.java:133)
at org.eclipse.core.runtime.internal.adaptor.EclipseAppLauncher.start(EclipseAppLauncher.java:103)
at org.eclipse.core.runtime.adaptor.EclipseStarter.run(EclipseStarter.java:378)
at org.eclipse.core.runtime.adaptor.EclipseStarter.run(EclipseStarter.java:232)
at sun.reflect.NativeMethodAccessorImpl.invoke0(Native Method)
at sun.reflect.NativeMethodAccessorImpl.invoke(NativeMethodAccessorImpl.java:57)
at sun.reflect.DelegatingMethodAccessorImpl.invoke(DelegatingMethodAccessorImpl.java:43)
at java.lang.reflect.Method.invoke(Method.java:606)
at org.eclipse.equinox.launcher.Main.invokeFramework(Main.java:648)
at org.eclipse.equinox.launcher.Main.basicRun(Main.java:603)
at org.eclipse.equinox.launcher.Main.run(Main.java:1462)
at org.eclipse.equinox.launcher.Main.main(Main.java:1438)
Caused by: org.eclipse.core.runtime.CoreException: Error while evaluating variable jboss_server_home.
at org.eclipse.core.internal.variables.DynamicVariable.getValue(DynamicVariable.java:58)
at org.eclipse.core.internal.variables.StringSubstitutionEngine.resolve(StringSubstitutionEngine.java:269)
at org.eclipse.core.internal.variables.StringSubstitutionEngine.substitute(StringSubstitutionEngine.java:192)
at org.eclipse.core.internal.variables.StringSubstitutionEngine.performStringSubstitution(StringSubstitutionEngine.java:87)
at org.jboss.ide.eclipse.as.core.resolvers.RuntimeVariableResolver.resolve(RuntimeVariableResolver.java:74)
... 60 more
Caused by: java.lang.NullPointerException
at org.jboss.ide.eclipse.as.core.resolvers.ConfigNameResolver.handleServerHome(ConfigNameResolver.java:137)
at org.jboss.ide.eclipse.as.core.resolvers.ConfigNameResolver.resolveValue(ConfigNameResolver.java:131)
at org.jboss.ide.eclipse.as.core.resolvers.ConfigNameResolver.resolveValue(ConfigNameResolver.java:116)
at org.eclipse.core.internal.variables.DynamicVariable.getValue(DynamicVariable.java:56)
... 64 more