SECURITIES PURCHASE AGREEMENT
 
BY AND BETWEEN
 
DGSE COMPANIES, INC.
 
AND
 
NTR METALS, LLC
 
DATED AS OF SEPTEMBER 12, 2011
 
 
 

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TABLE OF CONTENTS
 

 
Page
   
ARTICLE 1 PURCHASE AND SALE OF SECURITIES
1
     
Section 1.1
Purchase and Sale
1
Section 1.2
Consideration
1
     
ARTICLE 2 PAYMENT OF PURCHASE PRICE
1
     
Section 2.1
Payment of Purchase Price
1
     
ARTICLE 3 CLOSING DELIVERIES
2
     
Section 3.1
Delivery by the Company
2
Section 3.2
Delivery by Purchaser
2
Section 3.3
Closing Costs
2
     
ARTICLE 4 REPRESENTATIONS AND WARRANTIES OF COMPANY
2
   
Section 4.1
Representations and Warranties of the Company
2
     
ARTICLE 5 REPRESENTATIONS, WARRANTIES AND ACKNOWLEDGMENTS OF PURCHASER
5
   
Section 5.1
Representations and Warranties of Purchaser
5
     
ARTICLE 6 COVENANTS
7
   
Section 6.1
General
7
Section 6.2
Exchange Listing
7
     
ARTICLE 7 INDEMNIFICATION
8
   
Section 7.1
Representations and Warranties
8
Section 7.2
Indemnification.
8
Section 7.3
Indemnification Procedures.
8
Section 7.4
Exclusive Remedy
10
     
ARTICLE 8 MISCELLANEOUS
10
   
Section 8.1
Notices
10
Section 8.2
Assignment
11
Section 8.3
Amendments; No Waivers
11
Section 8.4
Entire Agreement/No Third Party Beneficiaries
11
Section 8.5
Governing Law
11
Section 8.6
Exclusive Jurisdiction
11
Section 8.7
Counterparts; Effectiveness
11
Section 8.8
Severability
11
Section 8.9
Incorporation of Exhibits
11
Section 8.10
Headings
12
Section 8.11
Construction
12

EXHIBITS

Exhibit A
Registration Rights Agreement

SCHEDULES

Schedule 2.1
Wire Transfer Instructions

Schedule 4.1.4(a)
Capitalization

   
 
 

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SECURITIES PURCHASE AGREEMENT
 
THIS SECURITIES PURCHASE AGREEMENT (this “Agreement”), dated as of September 12,
2011 (the “Effective Date”), is entered into by and between DGSE COMPANIES,
INC., a Nevada corporation (the “Company”), and NTR METALS, LLC, a Texas limited
liability company (the “Purchaser”).
 
WITNESSETH
 
WHEREAS, the Company wishes to sell and issue 400,000 shares  (the “Securities”)
of the common stock of the Company, par value $0.01 per share (the “Common
Stock”), for an aggregate sales price of two million dollars (US$2,000,000), or
five dollars ($5.00) per share (the “Purchase Price”), to Purchaser; and
 
WHEREAS, Purchaser wishes to purchase the Securities from the Company for the
Purchase Price.
 
NOW, THEREFORE, in consideration of the mutual covenants and agreements set
forth herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
 
ARTICLE 1
 
PURCHASE AND SALE OF SECURITIES
 
Section 1.1             Purchase and Sale. Upon the terms herein, and in
reliance upon the representations, warranties and covenants set forth herein,
Purchaser hereby purchases from the Company, and the Company hereby sells and
issues to Purchaser, the Securities.
 
Section 1.2             Consideration. The total consideration for the
Securities shall be the Purchase Price.
 
ARTICLE 2
 
PAYMENT OF PURCHASE PRICE
 
Section 2.1             Payment of Purchase Price. The Purchase Price to be paid
by Purchaser to the Company shall be paid contemporaneously with the execution
of this Agreement (the “Closing”) by wire transfer of immediately-available
funds to an account specified by the Company, as set forth on Schedule 2.1.
 
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ARTICLE 3
 
CLOSING DELIVERIES
 
Section 3.1          Delivery by the Company.  Prior to or contemporaneously
with the Closing, the Company shall cause to be delivered to Purchaser the
following documents and instruments:
 
3.1.1           A certificate or certificates representing and evidencing the
Securities, duly executed by authorized representatives of the Company, or, if
delivered in electronic form, evidence that the Company has instructed its
transfer agent to issue the Securities to Purchaser;
 
3.1.2           A certified resolution of the Company’s Board of Directors
authorizing the execution of this Agreement and the consummation of the
transactions contemplated hereby; and
 
3.1.3           A copy of that certain Registration Rights Agreement, dated as
of September 12, 2011, by and between the Company and the Purchaser (the
“Registration Rights Agreement”), in form attached hereto as Exhibit A, executed
on behalf of the Company, providing for incidental registration rights for the
offer and sale of the Securities pursuant to the registration requirements of
the Securities Act of 1933, as amended (the “Securities Act”).
 
Section 3.2          Delivery by Purchaser.  Prior to or contemporaneously with
the Closing, Purchaser shall cause to be delivered to the Company the following
documents and instruments:
 
3.2.1           A certified resolution of Purchaser’s Board of
Managers authorizing the execution of this Agreement and the consummation of the
transactions contemplated hereby;
 
3.2.2           A copy of the Registration Rights Agreement, executed on behalf
of Purchaser; and
 
3.2.3           The Purchase Price.
 
Section 3.3          Closing Costs.  Each party shall pay its respective closing
costs, if any, associated with the purchase and sale of the Securities.
 
ARTICLE 4
 
REPRESENTATIONS AND WARRANTIES OF COMPANY
 
Section 4.1         Representations and Warranties of the Company.  The Company
makes the following representations and warranties to Purchaser, which
representations and warranties shall be true and correct as of the date hereof.
 
4.1.1           Corporate Existence and Power.  The Company is a corporation
duly incorporated, validly existing and in good standing under the laws of the
State of Nevada. The Company has all requisite corporate power and authority to
carry on its business as presently conducted.  The Company has all necessary
corporate power to enter into this Agreement and the other transaction documents
required hereunder (the “Transaction Documents”) to which the Company is a
party, to perform its obligations hereunder and thereunder and to consummate the
transactions contemplated hereby and thereby.
 
4.1.2           Authorization.  The execution, delivery and performance of this
Agreement and the other Transaction  Documents to which the Company is a party
by the Company has been duly authorized and approved by the Company’s Board of
Directors, and no other proceedings on the part of the Company are necessary to
authorize this Agreement or the other Transaction  Documents to which the
Company is a party or to consummate the transaction contemplated hereby or
thereby.  This Agreement and the other Transaction  Documents to which the
Company is a party have been duly and validly executed and delivered by the
Company.  This Agreement and the other Transaction  Documents towhich the
Company is a party constitute a valid and binding obligation enforceable in
accordance with their respective terms.
 
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4.1.3           Non-Contravention.  Neither the execution and delivery of this
Agreement or the other Transaction  Documents to which the Company is a party,
nor the consummation of the transactions contemplated hereby or thereby, will
(a) violate any provision of the Company’s Certificate of Incorporation or
bylaws or any amendments thereto, (b) violate any applicable constitution,
statute, regulation, rule, injunction, judgment, order, decree, ruling, charge
or other restriction (collectively, “Law”), except for, in all cases, such
violations that would not prohibit or materially impair the Company’s ability to
perform its obligations under this Agreement or the other Transaction  Documents
to which the Company is a party, or (c) result in any material breach of, or
constitute a material default under or give to others any material rights of
termination, amendment, acceleration, modification or cancellation of any
material contract to which the Company is a party or to which any of its assets
or properties is subject, except in any such case for any violations, conflicts,
breaches, defaults or other matters that would not prohibit or materially impair
the Company’s ability to perform its obligations under this Agreement or the
other Transaction  Documents to which the Company is a party.
 
4.1.4           Capitalization.
 
    (a)           The authorized capital stock of the Company consists of
10,000,000 shares of the Company Common Stock.  As of the close of business on
August  31, 2011, (i) 10,425,633 shares of the Company Common Stock were
outstanding, (ii) an aggregate of 1,498,134 shares of Company Common Stock were
issuable upon exercise of then outstanding stock options (whether or not
exercisable as of such date), (iii) and there were no outstanding warrants to
purchase shares of the Company Common Stock..  All of the issued and outstanding
capital stock of the Company has been duly-authorized, is validly-issued,
fully-paid, and non-assessable.  The Company’s capital stock is not subject to,
nor was it issued in violation of, any preemptive rights or rights of first
refusal.  Other than as disclosed in any registration statements, prospectuses,
reports, schedules, forms, statements and other documents (including exhibits
and all other information incorporated by reference) required to be filed or
furnished with the Securities Exchange Commission (the “SEC”) by the Company
(the “Company SEC Documents”), except as set forth above, there are no
outstanding or authorized options, warrants, rights, contracts, calls, puts,
rights to subscribe, conversion rights, or other agreements or commitments
providing for the issuance, disposition, or acquisition of any of the Company’s
capital stock (other than this Agreement).  Other than as disclosed in the
Company SEC Documents, except as set forth on Schedule 4.1.4(a), there are no
outstanding or authorized equity appreciation, phantom equity, or similar rights
with respect to the Company.  Other than as disclosed in the Company SEC
Documents, except as set forth on Schedule 4.1.4(a), there are no voting trusts,
proxies, or any other agreements or understandings with respect to the voting of
the Company’s capital stock.  Other than as disclosed in the Company SEC
Documents, the Company is not subject to any obligation (contingent or
otherwise) to repurchase or otherwise acquire or retire any of the Company’s
capital stock.
 
    (b)           The Securities have been duly-authorized and, when issued and
delivered in accordance with the terms of this Agreement will have been
validly-issued and will be fully-paid and non-assessable and the issuance
thereof is not subject to any preemptive rights or rights of first refusal.
 
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4.1.5           SEC Filings. The Company has timely filed with or furnished to,
as applicable, the SEC all Company SEC Documents since January 1, 2009 (the
“Current Company SEC Documents”).  As of their respective filing dates (or, if
amended or superseded by a subsequent filing, as of the date of the last such
amendment or superseding filing prior to the date hereof), each of the Current
Company SEC Documents complied as to form in all material respects with the
applicable requirements of the Securities Act and the Securities Exchange Act of
1934, as amended (the “Exchange Act”), and the rules and regulations of the SEC
thereunder applicable to such Current Company SEC Documents.  Other than as
described in the Current Company SEC Documents, none of the Current Company SEC
Documents, including any financial statements, schedules or exhibits included or
incorporated by reference therein at the time they were filed (or, if amended or
superseded by a subsequent filing, as of the date of the last such amendment or
superseding filing prior to the date hereof), contained any untrue statement of
a material fact or omitted to state a material fact required to be stated
therein or necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading.  Other than as
described in the Current Company SEC Documents, each of the consolidated
financial statements of the Company (including, in each case, any notes thereto)
included in the Current Company SEC Documents have been prepared in accordance
with United States generally accepted accounting principles, as in effect from
time to time, applied on a consistent basis during the periods involved (except
as may be indicated therein or in the notes thereto).  As of the date of this
Agreement, neither the Company nor any of its subsidiaries has any pending or
unresolved comments from the SEC or any other governmental entity with respect
to any of the Current Company SEC Documents.
 
4.1.6           Third-Party Consents.  The execution, delivery and performance
of this Agreement and the other Transaction  Documents to which the Company is a
party do not and will not require any material consent, approval, authorization
or other action by, or filing with or notification to, any third party or
governmental entity by the Company, except where the failure to obtain such
consent, approval, authorization or action, or to make such filing or
notification, would not prevent or materially delay the consummation by the
Company of the transactions contemplated by this Agreement or the other
Transaction  Documents to which the Company is a party.
 
4.1.7           Governmental Authorization.  The Company is not required to give
any notice to, make any filing with, or obtain any authorization, consent, or
approval of any governmental entity in connection with the consummation of the
transactions contemplated by this Agreement or the other Transaction  Documents
to which the Company is a party.
 
4.1.8           Litigation.  The Company has not received written notice from
any governmental entity that consummation of the transactions contemplated by
this Agreement or the other Transaction Documents to which the Company is a
party would constitute a violation of any Laws.  There is no material order or
claim pending or to the knowledge of the Company, threatened, against or
affecting the Company that individually or when aggregated with one or more
other claims would prohibit or materially impair the Company’s ability to
perform its obligations under this Agreement or the other Transaction Documents
to which the Company is a party.  Other than as disclosed in the Company SEC
Documents, there is no material matter as to which the Company has received any
notice, claim or assertion, or to the knowledge of the Company, which otherwise
has been threatened or initiated, against or affecting the Company.
 
4.1.9           Brokers.  No investment banker, broker, finder or other
intermediary has been retained by or is authorized to act on behalf of the
Company who would be entitled to any fee or commission upon consummation of the
transactions contemplated by this Agreement.
 
 
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ARTICLE 5
 
REPRESENTATIONS, WARRANTIES AND ACKNOWLEDGMENTS OF
 PURCHASER
 
Section 5.1          Representations and Warranties of Purchaser.  Purchaser
acknowledges that it is purchasing the Securities without being furnished any
offering literature or prospectus.  Purchaser acknowledges that it has been
furnished, or had made available to it via EDGAR, (i) the most recent Annual
Report on Form 10-K of the Company, (ii) all subsequently-filed Quarterly
Reports on Form 10-Q of the Company, and (iii) all subsequently-filed Current
Reports on Form 8-K of the Company (collectively, the “Company Reports”) as
filed with the SEC.  Purchaser acknowledges that Purchaser has had sufficient
time to review the Company Reports, and further acknowledges that Purchaser has
not been furnished, and may not rely on, any other information other than
information or disclosure contained within the Company SEC Documents concerning
the Company in connection with Purchaser’s decision to purchase the Securities.
Purchaser acknowledges that it has had an opportunity to ask questions and
receive answers concerning the terms and conditions of the offering of the
Securities and to obtain any additional information that the Company possesses,
or could acquire without unreasonable effort or expense, necessary to verify the
accuracy of such information.  Purchaser further represents and warrants that:
 
5.1.1           Organization; Authorization.  Purchaser is a limited liability
company duly organized, validly existing and in good standing under the laws of
the State of Texas, with full power and authority to enter into this Agreement
and the Transaction Documents to which Purchaser is a party, to carry out its
obligations hereunder and thereunder and to consummate the transactions
contemplated hereby and thereby.  The execution and delivery by Purchaser of
this Agreement and the Transaction Documents to which Purchaser is a party, the
performance by Purchaser of its obligations hereunder and thereunder and the
consummation by Purchaser of the transactions contemplated hereby and thereby
have been duly authorized by all requisite company action on the part of
Purchaser.  This Agreement has been duly executed and delivered by Purchaser and
this Agreement constitutes a legal, valid and binding obligation of Purchaser
enforceable against Purchaser in accordance with its terms.  When each other
Transaction Document to which Purchaser is or will be a party has been duly
executed and delivered by Purchaser, such Transaction Document will constitute a
legal and binding obligation of Purchaser enforceable against Purchaser in
accordance with the terms of such transaction document.
 
5.1.2           Non-Contravention.  Neither the execution and delivery of this
Agreement, nor the consummation of the transactions contemplated hereby, will
(i) violate any provision of Purchaser’s Limited Liability Company Operating
Agreement or any amendments thereto or (ii) violate any Law of any government
entity to which Purchaser is subject.
 
5.1.3           Accredited Investor Status.  Purchaser is an “accredited
investor” as that term is defined in Rule 501(a) of Regulation D, promulgated
under the Securities Act.
 
5.1.4           Investment Purpose.  Purchaser is acquiring the Securities for
investment purposes only and not with a view to, or for offer or sale in
connection with, any distribution thereof.  Purchaser acknowledges that the
offer and sale of the Securities has not been registered under the Securities
Act, and that the Securities may not be offered, sold, transferred,
hypothecated, mortgaged, pledged, assigned or otherwise disposed of except
pursuant to an effective registration statement or an applicable exemption from
the registration requirements of the Securities Act and subject to applicable
state securities laws and regulations.
 
 
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5.1.5           Knowledge.  Purchaser has such knowledge and experience in
financial and business matters that it is capable of evaluating the merits and
risks of an investment in the Securities and of making an informed investment
decision.
 
5.1.6           Access to Information.  Before executing this Agreement, the
Purchaser has had access to all information regarding the financial condition
and business of the Company that it has requested, and it has had sufficient
opportunity to ask questions of, and has received answers (to the extent
available without unreasonable effort) from, the Company’s management.
 
5.1.7           No Representations.  There have been no representations,
guaranties, or warranties made to the Purchaser by the Company, or its agents or
employees, or by any other person, expressly or by implication, with respect to
(i) the approximate length of time that the Purchaser will be required to remain
an owner of the Securities; (ii) the percentage of profit and/or amount of or
type of consideration, profit, or loss (including, without limitation, tax
benefits) to be realized, if any, as a result of investment in the Securities;
and (iii) the possibility that the past performance or experience on the part of
any officer or director of the Company, or of any other person, might in any way
indicate the predictable results of operations of the Company, or of ownership
of the Securities.
 
5.1.8           No Recommendation or Endorsement.  Purchaser understands that no
federal or state agency has passed on or made any recommendation or endorsement
of the Securities.
 
5.1.9           Economic Risk.  Purchaser can bear the economic risk of losing
its entire investment.
 
5.1.10         No Obligation to Register.  Purchaser understands that other than
pursuant to the Registration Rights Agreement, the Company is under no
obligation to register the resale of any of the Securities in the future.
 
5.1.11         Restricted Securities.  Purchaser understands that (i) the
Securities (when issued) are restricted securities within the meaning of Rule
144 promulgated under the Securities Act (“Rule 144”), (ii) the offer and sale
of the Securities has not been registered under the Securities Act or any
applicable state laws, and (iii) the exemption from registration under Rule 144
will not be available unless the terms and conditions of Rule 144 have been
complied with.
 
5.1.12         No Transfer.  Purchaser will not transfer or offer to transfer
its Securities, (when issued) until it notifies the Company of his intention to
do so and until it has been notified by the Company that either (i) in the
opinion of counsel satisfactory to the Company, the Securities may be
transferred or offered for transfer free of restrictive legend, or (ii) an
appropriate registration statement with respect to the Securities has been filed
by the Company with the SEC and any applicable state securities authority and
declared effective by the SEC and any such authorities.
 
5.1.13         Restrictive Legend.  Purchaser understands that the
representatives of the Company will make notations in the appropriate records of
the Company of the restrictions on the transferability of the Securities and may
stamp or affix to any document or instrument representing the Securities an
appropriate legend stating, in effect, that the resale of the Securities has not
been registered under the Securities Act and that transfers thereof are
prohibited unless (among other things) such transfers comply with the Securities
Act and applicable state securities laws or unless an opinion of counsel
satisfactory to the Company is furnished by the Purchaser to the effect that an
exemption from registration under the Securities Act and applicable state
securities laws is available or is not required.
 
 
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5.1.14         Brokers.  No investment banker, broker, finder or other
intermediary has been retained by or is authorized to act on behalf of Purchaser
who would be entitled to any fee or commission upon consummation of the
transactions contemplated by this Agreement.
 
5.1.15         Legal Proceedings.  There are no actions, suits or proceedings of
any nature pending or, to the knowledge of Purchaser, threatened against or by
Purchaser, any affiliate of Purchaser, any of their properties or any of their
managers, officers or directors (in their capacities as such) that challenge or
seek to prevent, enjoin or otherwise delay the transactions contemplated by this
Agreement.  To the knowledge of Purchaser, no event has occurred or
circumstances exist that may give rise to or serve as a basis for any such
action, suit or proceeding.
 
5.1.16         Full Disclosure.  No representation or warranty by Purchaser in
this Agreement, any of the Transaction Documents to which Purchaser is a party,
or any certificate or other document furnished or to be furnished to Purchaser
pursuant to this Agreement contains any untrue statement of a material fact, or
omits to state a material fact necessary to make the statements contained
therein, in light of the circumstances in which they are made, not misleading.
 
5.1.17         Disclosure of Certain Information.  Purchaser understands and
acknowledges that the Company may be required to disclose to the SEC this
Agreement and information relating to this Agreement, and hereby agrees that the
Company, in its discretion, may disclose this Agreement and such information to
the SEC at such time and in such manner as the Company deems reasonable or
necessary.
 
ARTICLE 6
 
COVENANTS
 
Section 6.1          General.  In case at any time after the Closing any further
action is necessary to carry out the purposes of this Agreement, each of the
parties will take such further action (including the execution and delivery of
such further instruments and documents) as any other party reasonably may
request, all at the sole cost and expense of the requesting party (unless the
non-requesting party is obligated to do so at their sole cost and expense
pursuant to the terms and conditions of this Agreement).
 
Section 6.2          Reasonable Efforts; Consents.  Subject to the terms and
conditions provided in this Agreement, each of the parties hereto shall use its
commercially reasonable efforts to take promptly, or cause to be taken, all
actions, and to do promptly, or cause to be done, all things necessary, proper
or advisable under applicable laws and regulations to consummate and make
effective the transactions contemplated hereby to obtain all necessary waivers,
consents and approvals and to effect all necessary registrations and filings and
to remove any injunctions or other impediments or delays, legal or otherwise, in
order to consummate and make effective the transactions contemplated by this
Agreement for the purpose of securing to the parties hereto the benefits
contemplated by this Agreement.
 
Section 6.3          Exchange Listing.  The Company will use its commercially
reasonable efforts to list the Securities on the NYSE Amex Equities stock
exchange (the “NYSE Amex Exchange”) such that, upon (i) the expiration of the
holding period set forth in Rule 144 of the Securities Act applicable to the
Securities or (ii) an effective resale registration statement in compliance with
the requirements of the Securities Act, the Securities may be traded on the NYSE
Amex Exchange.
 
 
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ARTICLE 7
 
INDEMNIFICATION
 
Section 7.1          Representations and Warranties.  The representations and
warranties of the Company and Purchaser will survive indefinitely
notwithstanding any applicable statute of limitations (the “Survival Period”);
additionally, any obligations under Section 7.2 will not terminate with respect
to any losses, liabilities, claims, obligations, deficiencies, demands,
judgments, damages, interest, fines, penalties, claims, suits, actions, causes
of action, assessments, awards, costs, and expenses (including costs of
investigation and defense and attorneys’ and other professionals’ fees), whether
or not involving a Third-Party Claim (at that term is defined herein) (each, a
“Loss,” and collectively, “Losses”) as to which the person to be indemnified
will have given notice (stating in reasonable detail the basis of the claim for
indemnification) to the Purchaser in accordance with Section 7.3 before the
termination of the applicable Survival Period.
 
Section 7.2          Indemnification.
 
7.2.1           From and after the execution of this Agreement, but subject to
the remaining provisions of this Article 7, Purchaser  will indemnify and hold
the Company and its affiliates and directors, managers, officers, employees,
equity holders, members, partners, agents, attorneys, representatives,
successors, and permitted assigns (collectively, the “Company Indemnified
Parties”) harmless from and against, and pay to the applicable Company
Indemnified Parties the amount of, any and all Losses based upon, attributable
to, or resulting from:
 
    (a)           Any inaccuracy of the representations or warranties made by
Purchaser in this Agreement as of the date of this Agreement, except to the
extent that any such representation or warranty relates to a specific date, in
which case the failure of such representation or warranty to be true and correct
as of such date; and
 
    (b)           Any breach of any covenant or other agreement on the part of
Purchaser under this Agreement.
 
Section 7.3          Indemnification Procedures.
 
7.3.1           A claim for indemnification for any matter not involving a
Third-Party Claim (as that term is defined herein) may be asserted by prompt
written notice to the party from whom indemnification is sought.
 
7.3.2           In the event that any judicial, administrative, or arbitral
action, suit, mediation, investigation, inquiry, proceeding, or claim (including
any counterclaim) by or before any governmental body is instituted or that any
claim or demand is asserted by any third party in respect of which
indemnification may be sought under Section 7.2 (a “Third-Party Claim”), the
indemnified party will promptly cause written notice of the assertion of any
Third-Party Claim of which it has knowledge that is covered by this indemnity to
be forwarded to the indemnifying party.  The failure of the indemnified party to
give reasonably prompt written notice of any Third-Party Claim will not release,
waive, or otherwise affect the indemnifying party’s obligations with respect
thereto, except to the extent that the indemnifying party can demonstrate that
it has been prejudiced as a result of such failure. Subject to the provisions of
this Section 7.3:
 
 
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   (a)           The indemnifying party may elect by written notice to the
indemnified party to assume and control, at its sole expense, the defense of any
such Third-Party Claim, and the indemnifying party will have the right, at its
sole expense, to be represented by counsel of its choice, which must be
reasonably satisfactory to the indemnified party, and to defend against,
negotiate, settle, or otherwise deal with any Third-Party Claim that relates to
any Losses indemnified against under this Article 7; provided that the
indemnifying party will have acknowledged in writing to the indemnified party
its unqualified obligation to indemnify the indemnified party as provided under
this Article 7;
 
   (b)           if the indemnifying party elects to defend against, negotiate,
settle, or otherwise deal with any Third-Party Claim that relates to any Losses
indemnified against by them under this Article 7, it will reasonably promptly
notify the indemnified party of its intent to do so; provided, however, that the
indemnifying party must conduct its defense of the Third-Party Claim actively
and diligently thereafter in order to preserve its rights in this regard;
 
   (c)           if the indemnifying party elects not to defend against,
negotiate, settle, or otherwise deal with any Third-Party Claim that relates to
any Losses indemnified against by it under this Article 7, failure to notify the
indemnified party of its election as provided in Section 7.3.2(b), or contests
its obligation to indemnify the indemnified party for such Losses under this
Agreement, the indemnified party may defend against, negotiate, settle, or
otherwise deal with such Third-Party Claim;
 
   (d)           if the indemnifying party will assume the defense of any
Third-Party Claim, the indemnified party may participate, at its own expense, in
the defense of such Third-Party Claim; provided, however, that such indemnified
party will be entitled to participate in any such defense with separate counsel
at the expense of the indemnifying party if (1) so requested by the indemnifying
party to participate or (2) in the reasonable opinion of counsel to the
indemnified party, a conflict or potential conflict exists between the
indemnified party and the indemnifying party that would make such separate
representation advisable.
 
7.3.3           The indemnified party and the indemnifying party shall cooperate
in order to ensure the proper and adequate defense of a Third-Party Claim,
including, to the extent permitted by Law, by providing access to each other's
relevant business records and other documents and employees, subject to
customary covenants of confidentiality. The indemnified party and the
indemnifying party shall use their reasonable best efforts to avoid production
of confidential or competitively sensitive information (consistent with
applicable Law), and to cause all communications among employees, counsel and
others representing any party to a Third-Party Claim to be made so as to
preserve any applicable attorney-client or work-product privileges.
 
7.3.4           Notwithstanding anything in this Section 7.3 to the contrary,
neither the indemnifying party nor the indemnified party may, without the
written consent of the other party, settle or compromise any Third-Party Claim
or permit a default or consent to entry of any judgment unless (i) the claimant
(or claimants) and such party provide to such other party an unqualified release
from all liability in respect of the Third-Party Claim, and (ii) the terms of
settlement or compromise of such Third-Party Claim provide that the indemnified
party shall have no responsibility for the discharge of any settlement amount
and impose no other obligations or duties on the indemnified party (including
any admission of culpability). If the indemnifying party makes any payment on
any Third-Party Claim, the indemnifying party will be subrogated, to the extent
of such payment, to all rights and remedies of the indemnified party to any
insurance benefits or other claims of the indemnified party with respect to such
Third-Party Claim.
 
7.3.5           With respect to a Third-Party Claim under this Section 7.3,
after (i) any final decision, judgment or award will have been rendered by a
governmental body of competent jurisdiction and the expiration of the time in
which to appeal therefrom, (ii) a settlement will have been consummated, or
(iii) the indemnified party and the indemnifying party will have arrived at a
mutually binding agreement, the indemnified party will forward to the
indemnifying party notice of any sums due and owing by the indemnifying party in
accordance with this Agreement with respect to such matter and the indemnifying
party will pay all of such remaining sums so due and owing to the indemnified
party in accordance with this Article 7.
 
 
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Section 7.4          Exclusive Remedy.  The parties acknowledge and agree that
the foregoing indemnification provisions in this Article 7 shall be the sole and
exclusive remedy with respect to a breach of the representations, warranties and
covenants contained in this Agreement, except in the case of fraud; provided,
however, this Article 7 shall not prohibit equitable remedies, including,
without limitation, specific performance or injunctive relief.
 
ARTICLE 8
 
 MISCELLANEOUS
 
Section 8.1          Notices.  Any notices or other communications required or
permitted hereunder shall be sufficiently given if in writing and (i) hand
delivered, or (ii) sent by certified mail, return receipt requested, postage
prepaid, addressed as shown below, or to such other address as the party
concerned may substitute by written notice to the other. All notices hand
delivered shall be deemed received on the date of delivery. All notices
forwarded by mail shall be deemed received on a date three (3) days immediately
following date of deposit in the U.S. Mail; provided, however, the return
receipt indicating the date upon which all notices were received shall be prima
facie evidence that such notices were received on the date on the return
receipt.
 
If to the Company:
DGSE Companies, Inc.
 
11311 Reeder Road
 
Dallas, Texas 75229-3408
 
Attn: Dr. L. S. Smith
   
With a copy (which shall not constitute notice) to:
K&L Gates LLP
 
1717 Main St., Suite 2800
 
Dallas, Texas 75201
 
Attn: I. Bobby Majumder, Esq.
   
If to Purchaser:
NTR Metals, LLC
 
10720 Composite Drive
 
Dallas, Texas 75220-1208
 
Attn:  Carl D. Gum, III, General Counsel
   
With a copy (which shall not constitute notice) to:
Jones Day
 
2727 N. Harwood Street
 
Dallas, Texas  75201
 
Attn:  Emil Bova, Esq.

 
 
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The addresses and addressees may be changed by giving notice of such change in
the manner provided herein for giving notice.  Unless and until such written
notice is received, the last address and addressee given shall be deemed to
continue in effect.  No notice to either Purchaser or the Company shall be
deemed given or received unless the entity noted “With a copy to” is
simultaneously delivered notice in the same manner as any notice given to
another party.
 
Section 8.2          Assignment.  This Agreement may not be assigned by either
party without the prior written consent of the other party.
 
Section 8.3          Amendments; No Waivers.  Any provision of this Agreement
may be amended or waived if, and only if, such amendment or waiver is in writing
and signed, in the case of an amendment, by the Company and Purchaser or in the
case of a waiver, by the party against whom the waiver is to be effective.  No
failure or delay by any party in exercising any right, power or privilege
hereunder shall operate as a waiver thereof nor shall any single or partial
exercise thereof preclude any other or further exercise thereof or the exercise
of any other right, power or privilege. The rights and remedies herein provided
shall be cumulative and not exclusive of any rights or remedies provided by law.
 
Section 8.4          Entire Agreement/No Third Party Beneficiaries.  All prior
negotiations and agreements between the parties hereto relating to the subject
matter hereof are superseded by this Agreement and as of the date hereof there
are no representations, warranties, understandings or agreements, whether
written or oral, express or implied, other than those specifically set forth
herein. Except for the shareholders, directors, officers, employees and agents
of the Company and the Company Indemnified Parties, to the extent such persons
benefit from the provisions set forth herein, there are no third party
beneficiaries to this Agreement.
 
Section 8.5          Further Assurances.  Each of the parties agrees to
cooperate fully in the effectuation of the transactions contemplated hereby and
to execute any and all additional documents or take such additional actions as
shall be reasonably necessary or appropriate for such purpose.
 
Section 8.6          Governing Law.  All issues and questions concerning the
construction, validity, enforcement and interpretation of this Agreement and the
exhibits and schedules hereto shall be governed by, and construed in accordance
with, the laws of the State of Texas, without giving effect to any choice of law
or conflict of law rules or provisions (whether of the State of Texas or any
other jurisdiction) that would cause the application of the laws of any
jurisdiction other than the State of Texas.  In furtherance of the foregoing,
the internal law of the State of Texas shall control the interpretation and
construction of this Agreement and the exhibits and schedules hereto, even
though under that jurisdiction’s choice of law or conflict of law analysis, the
substantive law of some other jurisdiction would ordinarily apply.
 
Section 8.8          Exclusive Jurisdiction.  The parties agree that any legal
action, suit or proceeding arising out of or relating to this Agreement or the
agreements and transactions contemplated hereby shall be instituted in a court
located in Dallas County, Texas, which shall be the exclusive jurisdiction and
venue of any legal proceedings, and each party hereto waives any objection which
such party may now or hereafter have to the laying of venue of any such action,
suit or proceeding.
 
Section 8.9          Counterparts; Effectiveness.  This Agreement may be signed
in any number of counterparts, each of which shall be an original, with the same
effect as if the signatures hereto were upon the same instrument.  This
Agreement shall become effective when each party hereto shall have received
counterparts hereof signed by all of the other parties hereto.
 
 
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Section 8.10        Severability.  If any term or other provision of this
Agreement is found to be invalid, illegal, or incapable of being enforced by any
rule, Law or public policy by a court of competent jurisdiction, all other
conditions and provisions of this Agreement shall nevertheless remain in full
force and effect so long as the economic or legal substance of the transactions
contemplated by this Agreement are not affected in any manner materially adverse
to any party. Upon such determination that any term or other provision is
invalid, illegal or incapable of being enforced, the parties hereto shall
negotiate in good faith to modify this Agreement so as to effect the original
intent of the parties as closely as possible in a mutually acceptable manner in
order that the transactions contemplated by this Agreement be consummated as
originally contemplated to the fullest extent possible.
 
Section 8.11        Incorporation of Exhibits.  All exhibits and schedules
attached hereto and referred to herein are hereby incorporated herein and made a
part hereof for all purposes as if fully set forth herein.
 
Section 8.12        Headings.  The descriptive headings contained in this
Agreement are included for convenience of reference only and shall not affect in
any way the meaning or interpretation of this Agreement.
 
Section 8.13        Construction.  The language used in this Agreement will be
deemed to be the language chosen by the parties hereto to express their mutual
intent, and no rule of strict construction shall be applied against either
party. Whenever required by the context, any gender shall include any other
gender, the singular shall include the plural and the plural shall include the
singular. Whenever the word “including” is used in this Agreement, it shall be
deemed to mean “including, without limitation,” “including, but not limited to”
or other words of similar import such that the items following the word
“including” shall be deemed to be a list by way of illustration only and shall
not be deemed to be an exhaustive list of applicable items in the context
thereof.
 
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IN WITNESS WHEREOF, the parties have executed this instrument as of the date
first written above.
 

 
Company:
         
DGSE COMPANIES, INC.,
   
a Nevada corporation
               
By:
Dr. L. S. Smith
   
Title:
Chairman & Chief Executive Officer
         
Purchaser:
         
NTR METALS, LLC,
   
a Texas limited liability company
               
By:
John R. Loftus
   
Title:
President

  
 
 

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EXHIBIT A
 
REGISTRATION RIGHTS AGREEMENT
 
 
 

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