**UNITED      STATES SECURITIES AND EXCHANGE COMMISSION**

**Washington,      D.C. 20549**

**Form 10-Q**

|   |   |                                                                                                                                     |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------|
| þ |   | **QUARTERLY                REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE                ACT OF                1934** |

**For      the quarterly period ended September 30, 2007**

**or**

|   |   |                                                                                                                                      |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------|
| o      |   | **TRANSITION                REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE                ACT OF                1934** |

**For      the transition period from _______ to _______**

**Commission      File Number 1-11048**

**DGSE      Companies, Inc.**

*Exact      name of registrant as specified in its charter*

|                                             |   |                                 |
|--------------------------------------------------|--------|--------------------------------------|
| **Nevada**                                       |   | **88-0097334**                       |
| *(State                or other jurisdiction of* |   | *(I.R.S.                Employer*    |
| *incorporation                or organization)*  |   | *Identification                No.)* |

**2817      Forest Lane**

**Dallas,      Texas 75234**

**(972) 484-3662**

*(Address,      including zip code, and telephone*

*number,      including area code, of registrant’s*

*principal      executive offices)*

**NONE**

*(Former      name, former address and former*

*fiscal      year, if changed since last report)*

|                                                    |   |                                              |   |                                       |
|---------------------------------------------------------|--------|---------------------------------------------------|--------|--------------------------------------------|
| Large                accelerated filer                o |   | Accelerated                filer                o |   | Non-accelerated                filerþ |

|                                                  |   |        |
|-------------------------------------------------------|--------|-------------|
| Class                                                 |   | Outstanding |
| Common                stock, $.01 par value per share |   | 9,899,664   |

----

**TABLE      OF CONTENTS**

|                        |   |                                                                                                                                      |   | Page                No. |
|-----------------------------|--------|-------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------|
| **PART                I.**  |   | **FINANCIAL                INFORMATION**                                                                                                  |   |                    |
|                        |   |                                                                                                                                      |   |                    |
| Item                1.      |   | Consolidated                Financial Statements.                                                                                         |   |                    |
|                        |   |                                                                                                                                      |   |                    |
|                        |   | Consolidated                Balance Sheets as of September 30, 2007 and December 31,                2006                                  |   | 1                       |
|                        |   |                                                                                                                                      |   |                    |
|                        |   | Consolidated                Statements of Operations for the three months ended September 30,                2007 and                2006 |   | 2                       |
|                        |   |                                                                                                                                      |   |                    |
|                        |   | Consolidated                Statements of Operations for the nine months ended September 30,                2007 and                2006  |   | 3                       |
|                        |   |                                                                                                                                      |   |                    |
|                        |   | Consolidated                Statements of Cash Flows for the nine months ended September 30,                2007 and                2006  |   | 4                       |
|                        |   |                                                                                                                                      |   |                    |
|                        |   | Notes                to Consolidated Financial Statements                                                                                 |   | 5                       |
|                        |   |                                                                                                                                      |   |                    |
| Item                2.      |   | Management’s                Discussion and Analysis of Financial Condition and Results of                Operations.                |   | 11                      |
|                        |   |                                                                                                                                      |   |                    |
| Item                3.      |   | Quantitative                and Qualitative Disclosures About Market Risk.                                                                |   | 15                      |
|                        |   |                                                                                                                                      |   |                    |
| Item                4.      |   | Controls                and Procedures.                                                                                                   |   | 15                      |
|                        |   |                                                                                                                                      |   |                    |
| **PART                II.** |   | **OTHER                INFORMATION**                                                                                                      |   |                    |
|                        |   |                                                                                                                                      |   |                    |
| Item                1.      |   | Legal                Proceedings.                                                                                                         |   | 16                      |
|                        |   |                                                                                                                                      |   |                    |
| Item                1A.     |   | Risk                Factors                                                                                                               |   | 17                      |
|                        |   |                                                                                                                                      |   |                    |
| Item                4.      |   | Submission                of Matters to a Vote of Security Holders.                                                                       |   | 21                      |
|                        |   |                                                                                                                                      |   |                    |
| Item                5.      |   | Other                Information.                                                                                                         |   | 21                      |
|                        |   |                                                                                                                                      |   |                    |
| Item                6.      |   | Exhibits.                                                                                                                                 |   | 21                      |
|                        |   |                                                                                                                                      |   |                    |
| **SIGNATURES**              |   | 25                                                                                                                                        |

----

**PART      I. FINANCIAL INFORMATION**

**Item      1. Consolidated Financial Statements.**

***DGSE      Companies, Inc. and Subsidiaries***

**CONDENSED      CONSOLIDATED BALANCE SHEETS**

|                                                                                                                                                                                                                                         |   | **September                30,****2007** |       | **December                31,****2006** |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|------------------------------------------|------------|-----------------------------------------|--------|
|                                                                                                                                                                                                                                         |   | **Unaudited**                            |       |                                    |   |
| **ASSETS**                                                                                                                                                                                                                                   |   |                                     |       |                                    |   |
| Current                Assets:                                                                                                                                                                                                               |   |                                     |       |                                    |   |
| Cash                and cash equivalents                                                                                                                                                                                           |   | $                                        | 1,380,668  |                                    | $      | 1,210,282 |   |
| Trade                receivables                                                                                                                                                                                                        |   |                                     | 4,073,794  |                                    |   | 1,053,454 |   |
| Inventories                                                                                                                                                                                                                             |   |                                     | 12,437,162 |                                    |   | 7,796,028 |   |
|  Prepaid                expenses                                                                                                                                                                                                   |   |                                     | 609,816    |                                    |   | 192,379 |   |
| Prepaid                federal income tax                                                                                                                                                                                               |   |                                     | —    |                                    |   | 97,472 |   |
| Total                current assets                                                                                                                                                                                                     |   |                                     | 18,501,440 |                                    |   | 10,349,615 |   |
|                                                                                                                                                                                                                                         |   |                                     |       |                                    |   |   |   |
| Marketable                securities - available for sale                                                                                                                                                                               |   |                                     | 57,879     |                                    |   | 57,879 |   |
| Property                and equipment, net                                                                                                                                                                                              |   |                                     | 590,847    |                                    |   | 1,024,405 |   |
| Deferred                income taxes                                                                                                                                                                                                    |   |                                     | 18,031     |                                    |   | 7,152 |   |
| Goodwill                                                                                                                                                                                                                                |   |                                     | 13,211,152 |                                    |   | 837,117 |   |
| Other                assets                                                                                                                                                                                                             |   |                                     | 393,915    |                                    |   | 869,398 |   |
|                                                                                                                                                                                                                                         |   | $                                        | 32,773,264 |                                    | $      | 13,145,566 |   |
|                                                                                                                                                                                                                                         |   |                                     |       |                                    |   |   |   |
| **LIABILITIES**                                                                                                                                                                                                                              |   |                                     |       |                                    |   |   |   |
| Current                Liabilities:                                                                                                                                                                                                          |   |                                     |       |                                    |   |   |   |
| Notes                payable                                                                                                                                                                                                            |   | $                                        | 183,708    |                                    | $      | 183,708 |   |
| Current                maturities of long-term debt                                                                                                                                                                                     |   |                                     | 215,354    |                                    |   | 259,273 |   |
| Accounts                payable - trade                                                                                                                                                                                                 |   |                                     | 1,000,047  |                                    |   | 828,323 |   |
| Accrued                expenses                                                                                                                                                                                                         |   |                                     | 783,787    |                                    |   | 721,305 |   |
| Customer                deposits                                                                                                                                                                                                        |   |                                     | 360,274    |                                    |   | 171,912 |   |
| Federal                income tax payable                                                                                                                                                                                               |   |                                     | 302,157    |                                    |   | — |   |
| Total                current liabilities                                                                                                                                                                                                |   |                                     | 2,845,327  |                                    |   | 2,164,521 |   |
|                                                                                                                                                                                                                                         |   |                                     |       |                                    |   |   |   |
| Long-term                debt, less current maturities                                                                                                                                                                                  |   |                                     | 9,794,247  |                                    |   | 4,303,685 |   |
|                                                                                                                                                                                                                                         |   |                                     | 12,639,574 |                                    |   | 6,468,206 |   |
|                                                                                                                                                                                                                                         |   |                                     |       |                                    |   |   |   |
| **STOCKHOLDERS’                EQUITY**                                                                                                                                                                                                |   |                                     |       |                                    |   |   |   |
| Common                stock, $.01 par value; 30,000,000 shares authorized; 9,470,357 and                4,913,290 shares issued and outstanding at the end of each period                in 2007                and 2006, respectively  |   |                                     | 94,704     |                                    |   | 49,133 |   |
| Additional                paid-in capital                                                                                                                                                                                               |   |                                     | 18,374,867 |                                    |   | 5,708,760 |   |
| Accumulated                other comprehensive loss                                                                                                                                                                                     |   |                                     | (132,245   | )                                       |   | (132,245 | ) |
| Retained                earnings                                                                                                                                                                                                        |   |                                     | 1,796,364  |                                    |   | 1,051,712 |   |
|                                                                                                                                                                                                                                         |   |                                     | 20,133,690 |                                    |   | 6,677,360 |   |
|                                                                                                                                                                                                                                         |   |                                     |       |                                    |   |   |   |
|                                                                                                                                                                                                                                         |   | $                                        | 32,773,264 |                                    | $      | 13,145,566 |   |

----

***DGSE      Companies, Inc. and Subsidiaries***

**CONSOLIDATED      STATEMENTS OF OPERATIONS**

|                                                                                                                                                                |   | **Three                months ended September30,** |       |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|----------------------------------------------------|------------|
|                                                                                                                                                                |   | **2007**                                           |       | **2006** |   |
|                                                                                                                                                                |   | **Unaudited**                                      |       |
| Revenue                                                                                                                                                             |   |                                               |       |   |   |
| Sales                                                                                                                                                          |   | $                                                  | 16,771,838 |   | $ | 9,497,528 |   |
| Consumer                loan service charges                                                                                                                   |   |                                               | 84,475     |   |   | 51,119 |   |
|                                                                                                                                                                |   |                                               | 16,856,313 |   |   | 9,548,647 |   |
|                                                                                                                                                                |   |                                               |       |   |   |   |   |
| Costs                and expenses                                                                                                                                   |   |                                               |       |   |   |   |   |
| Cost                of goods sold                                                                                                                              |   |                                               | 13,891,332 |   |   | 8,077,048 |   |
| Selling,                general and administrative expenses                                                                                                    |   |                                               | 2,726,610  |   |   | 1,186,023 |   |
| Depreciation                and amortization                                                                                                                   |   |                                               | 96,584     |   |   | 19,515 |   |
|                                                                                                                                                                |   |                                               | 16,714,526 |   |   | 9,282,586 |   |
|                                                                                                                                                                |   |                                               |       |   |   |   |   |
| Operating                income                                                                                                                                     |   |                                               | 141,787    |   |   | 266,061 |   |
|                                                                                                                                                                |   |                                               |       |   |   |   |   |
| Other                expense (income)                                                                                                                               |   |                                               |       |   |   |   |   |
| Interest                expense                                                                                                                                |   |                                               | 182,704    |   |   | 78,646 |   |
| Other                income                                                                                                                                    |   |                                               | (577,198   | ) |   | — |   |
|                                                                                                                                                                |   |                                               |       |   |   |   |   |
| Earnings                before income taxes                                                                                                                         |   |                                               | 536,281    |   |   | 187,415 |   |
|                                                                                                                                                                |   |                                               |       |   |   |   |   |
| Income                tax expense                                                                                                                              |   |                                               | 182,336    |   |   | 63,721 |   |
|                                                                                                                                                                |   |                                               |       |   |   |   |   |
| Net                earnings from continuing operations                                                                                                              |   |                                               | 353,945    |   |   | 123,694 |   |
|                                                                                                                                                                |   |                                               |       |   |   |   |   |
| Discontinued                operations:                                                                                                                        |   |                                               |       |   |   |   |   |
| Loss                from discontinued operations (less applicable income tax benefit                of $771                and $7,623, respectively)           |   |                                               | 1,498      |   |   | 14,798 |   |
| Loss                on disposal of discontinued operations (less applicable income tax                benefit                of $35,053 and $0, respectively)  |   |                                               | 68,043     |   |   | — |   |
|                                                                                                                                                                |   |                                               |       |   |   |   |   |
| Net                earnings                                                                                                                                    |   | $                                                  | 284,404    |   | $ | 108,896 |   |
|                                                                                                                                                                |   |                                               |       |   |   |   |   |
| Earnings                per common share - basic                                                                                                                    |   | $                                                  | 0.03       |   | $ | 0.02 |   |
| Earnings                per common share - diluted                                                                                                                  |   | $                                                  | 0.03       |   | $ | 0.02 |   |
| Weighted                average number of common shares:                                                                                                            |   |                                               |       |   |   |   |   |
| Basic                                                                                                                                                          |   |                                               | 8,582,357  |   |   | 4,913,290 |   |
| Diluted                                                                                                                                                        |   |                                               | 10,392,717 |   |   | 5,056,133 |   |

----

***DGSE      Companies, Inc. and Subsidiaries***

**CONSOLIDATED      STATEMENTS OF OPERATIONS**

|                                                                                                                                                             |   | **Nine                months ended September 30,** |       |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|----------------------------------------------------|------------|
|                                                                                                                                                             |   | **2007**                                           |       | **2006** |   |
|                                                                                                                                                             |   | **Unaudited**                                      |       |
| Revenue                                                                                                                                                          |   |                                               |       |   |   |
| Sales                                                                                                                                                       |   | $                                                  | 39,100,108 |   | $ | 31,570,446 |   |
| Consumer                loan service charges                                                                                                                |   |                                               | 193,775    |   |   | 144,666 |   |
| Management                fees                                                                                                                              |   |                                               | 250,000    |   |   | — |   |
|                                                                                                                                                             |   |                                               | 39,543,883 |   |   | 31,715,112 |   |
|                                                                                                                                                             |   |                                               |       |   |   |   |   |
| Costs                and expenses                                                                                                                                |   |                                               |       |   |   |   |   |
| Cost                of goods sold                                                                                                                           |   |                                               | 32,518,275 |   |   | 26,986,825 |   |
| Selling,                general and administrative expenses                                                                                                 |   |                                               | 5,697,795  |   |   | 3,543,562 |   |
| Depreciation                and amortization                                                                                                                |   |                                               | 196,127    |   |   | 69,154 |   |
|                                                                                                                                                             |   |                                               | 38,412,197 |   |   | 30,599,541 |   |
|                                                                                                                                                             |   |                                               |       |   |   |   |   |
| Operating                income                                                                                                                                  |   |                                               | 1,131,686  |   |   | 1,115,571 |   |
|                                                                                                                                                             |   |                                               |       |   |   |   |   |
| Other                expense (income)                                                                                                                            |   |                                               |       |   |   |   |   |
| Interest                expense                                                                                                                             |   |                                               | 427,840    |   |   | 229,227 |   |
| Other                income                                                                                                                                 |   |                                               | (579,449   | ) |   | — |   |
|                                                                                                                                                             |   |                                               |       |   |   |   |   |
| Earnings                before income taxes                                                                                                                      |   |                                               | 1,283,295  |   |   | 886,344 |   |
|                                                                                                                                                             |   |                                               |       |   |   |   |   |
| Income                tax expense                                                                                                                           |   |                                               | 436,321    |   |   | 301,357 |   |
|                                                                                                                                                             |   |                                               |       |   |   |   |   |
| Net                earnings from continuing operations                                                                                                           |   |                                               | 846,974    |   |   | 584,987 |   |
|                                                                                                                                                             |   |                                               |       |   |   |   |   |
| Discontinued                operations:                                                                                                                     |   |                                               |       |   |   |   |   |
| Loss                from discontinued operations (less applicable income tax benefit                of                $17,659 and $29,693, respectively)    |   |                                               | 34,279     |   |   | 57,640 |   |
| Loss                disposal of discontinued operations (less applicable income tax benefit                of                $35,053 and $0, respectively)  |   |                                               | 68,043     |   |   | — |   |
|                                                                                                                                                             |   |                                               |       |   |   |   |   |
| Net                earnings                                                                                                                                      |   | $                                                  | 744,652    |   | $ | 527,347 |   |
|                                                                                                                                                             |   |                                               |       |   |   |   |   |
| Earnings                per common share - basic                                                                                                            |   | $                                                  | 0.11       |   | $ | 0.11 |   |
|                                                                                                                                                             |   |                                               |       |   |   |   |   |
| Earnings                per common share - diluted                                                                                                          |   | $                                                  | 0.10       |   | $ | 0.11 |   |
|                                                                                                                                                             |   |                                               |       |   |   |   |   |
| Weighted                average number of common shares:                                                                                                         |   |                                               |       |   |   |   |   |
| Basic                                                                                                                                                       |   |                                               | 6,543,986  |   |   | 4,913,290 |   |
| Diluted                                                                                                                                                     |   |                                               | 7,395,848  |   |   | 4,989,065 |   |

----

***DGSE      COMPANIES, Inc. and Subsidiaries***

**CONSOLIDATED      STATEMENTS OF CASH FLOWS**

|                                                                                                             |   | **Nine                months ended****September                30,** |       |
|------------------------------------------------------------------------------------------------------------------|--------|----------------------------------------------------------------------|------------|
|                                                                                                             |   | **2007**                                                             |       | **2006** |   |
|                                                                                                                  |   | **Unaudited**                                                        |       |
| **Cash                flows from operating activities**                                                          |   |                                                                 |       |
| Net                earnings                                                                                 |   | $                                                                    | 744,652    |   | $ | 527,347 |   |
| Adjustments                to reconcile net earnings to net cash provided by operating                activities |   |                                                                 |       |   |   |   |   |
| Depreciation                and amortization                                                                |   |                                                                 | 196,127    |   |   | 69,154 |   |
| Deferred                taxes                                                                          |   |                                                                 | (10,879    | ) |   | — |   |
| Loss                on discontinued operations                                                         |   |                                                                 | 102,322    |   |   | 57,640 |   |
| Gain                on sale of building                                                                |   |                                                                 | (579,447   | ) |   | — |   |
| Change                in assets and liabilities:                                                                 |   |                                                                 |       |   |   |   |   |
| (Increase)                Decrease in trade receivables                                                     |   |                                                                 | (2,380,792 | ) |   | (185,711 | ) |
| (Increase)                Decrease in Inventories                                                           |   |                                                                 | (390,218   | ) |   | (881,104 | ) |
| (Increase)                Decrease in prepaid expenses and other assets                                     |   |                                                                 | (221,140   | ) |   | 7,204 |   |
| (Increase)                Decrease in other long term assets                                           |   |                                                                 | (98,745    | ) |   | (344,872 | ) |
| Increase                (Decrease) in accounts payable and accrued expenses                                 |   |                                                                 | (998,300   | ) |   | (623,956 | ) |
| Increase                (Decrease) in customer deposits                                                     |   |                                                                 | 69,549     |   |   | 176,026 |   |
| Increase                (Decrease) in income taxes payable                                                  |   |                                                                 | 399,629    |   |   | 166,971 |   |
| Net                cash used in operating activities                                                        |   |                                                                 | (3,167,242 | ) |   | (1,031,301 | ) |
| **Cash                flows from investing activities**                                                          |   |                                                                 |       |   |   |   |   |
| Pawn                loans made                                                                              |   |                                                                 | (391,136   | ) |   | (387,966 | ) |
| Pawn                loans repaid                                                                            |   |                                                                 | 241,425    |   |   | 319,203 |   |
| Recovery                of pawn loan principal through sale of forfeited collateral                         |   |                                                                 | 94,973     |   |   | 67,503 |   |
| Pay                day loans made                                                                           |   |                                                                 | (164,289   | ) |   | (207,428 | ) |
| Pay                day loans repaid                                                                         |   |                                                                 | 125,982    |   |   | 146,813 |   |
| Purchase                of property and equipment                                                           |   |                                                                 | (119,772   | ) |   | (13,739 | ) |
| Proceeds                from sale of discontinued operations                                                |   |                                                                 | 77,496     |   |   | — |   |
| Proceeds                from sale of building                                                               |   |                                                                 | 924,742    |   |   | — |   |
| Acquisition                of Euless Gold & Silver                                                      |   |                                                                 | (600,000   | ) |   | — |   |
| Deal                cost for Superior Galleries acquisition                                                 |   |                                                                 | (395,280   | ) |   | — |   |
| Net                cash used in investing activities                                                        |   |                                                                 | (205,859   | ) |   | (75,614 | ) |
| **Cash                flows from financing activities**                                                          |   |                                                                 |       |   |   |   |   |
| Proceeds                from notes issued                                                                   |   |                                                                 | 4,219,352  |   |   | 840,000 |   |
| Repayments                of notes payable                                                                  |   |                                                                 | (754,228   | ) |   | (558,637 | ) |
| Conversion                of warrants                                                                            |   |                                                                 | 78,363     |   |   | — |   |
| Net                cash provided by financing activities                                                    |   |                                                                 | 3,543,487  |   |   | 281,363 |   |
|                                                                                                             |   |                                                                 |       |   |   |   |   |
| NET                INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS                                         |   |                                                                 | 170,386    |   |   | (825,552 | ) |
| Cash                and cash equivalents at beginning of period                                             |   |                                                                 | 1,210,282  |   |   | 1,042,834 |   |
| Cash                and cash equivalents at end of period                                                   |   | $                                                                    | 1,380,668  |   | $ | 217,282 |   |

**Supplemental      disclosures:**

----

***DGSE      COMPANIES, Inc. and Subsidiaries***

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

**(1)        Basis of Presentation.**

**(2)        Inventory.**

|                      |   | September                30,2007 |       | December                31 2006 |   |
|---------------------------|--------|----------------------------------|------------|---------------------------------|--------|
| Jewelry                   |   | $                                | 9,140,854  |                            | $      | 7,022,453 |   |
| Rare                coins |   |                             | 2,235,141  |                            |   | 235,099 |   |
| Bullion                   |   |                             | 354,580    |                            |   | 113,867 |   |
| Scrap                gold |   |                             | 439,853    |                            |   | 374,284 |   |
| Other                     |   |                             | 266,734    |                            |   | 50,325 |   |
| Total                     |   | $                                | 12,437,162 |                            | $      | 7,796,028 |   |

**(3)        Trade Receivables.**

----

***DGSE        COMPANIES, Inc. and Subsidiaries***

**(4)        Earnings per share.**

|                                             |   | **2007**                                            |    | **2006**                                            |   |
|--------------------------------------------------|--------|-----------------------------------------------------|---------|-----------------------------------------------------|--------|
|                                             |   | **Three                months ended September 30,** |    | **Three                months ended September 30,** |   |
|                                             |   | **Net                Earnings**                     |    | **Shares**                                          |   | **Per                share** |   | **Net                Earnings** |   | **Shares** |   | **Per                share** |   |
|                                             |   |                                                |    |                                                |   |   |   |   |   |   |   |   |   |
| Basic                earnings per common share   |   | $                                                   | 284,404 |                                                |   | 8,582,357 |   | $ | 0.03 |   | $ | 108,096 |   |   | 4,913,290 |   | $ | 0.02 |   |
| Effect                of dilutive stock options  |   |                                                | — |                                                |   | 1,810,360 |   |   | — |   |   | — |   |   | 142,843 |   |   | — |   |
|                                             |   |                                                |         |                                                |   |  |   |   |  |   |   |  |   |   |  |   |   |  |   |
| Diluted                earnings per common share |   | $                                                   | 284,404 |                                                |   | 10,392,717 |   | $ | 0.03 |   | $ | 108,096 |   |   | 5,056,133 |   | $ | 0.02 |   |

|                                             |   | **2007**                                           |    | **2006**                                           |   |
|--------------------------------------------------|--------|----------------------------------------------------|---------|----------------------------------------------------|--------|
|                                             |   | **Nine                months ended September 30,** |    | **Nine                months ended September 30,** |   |
|                                             |   | **Net                Earnings**                    |    | **Shares**                                         |   | **Per                share** |   | **Net                Earnings** |   | **Shares** |   | **Per                share** |   |
|                                             |   |                                               |    |                                               |   |   |   |   |   |   |   |   |   |
| Basic                earnings per common share   |   | $                                                  | 744,652 |                                               |   | 6,543,986 |   | $ | 0.11 |   | $ | 527,347 |   |   | 4,913,290 |   | $ | 0.11 |   |
| Effect                of dilutive stock options  |   |                                               | — |                                               |   | 851,862 |   |   | (0.01 | ) |   | — |   |   | 75,775 |   |   | — |   |
|                                             |   |                                               |         |                                               |   |  |   |   |  |   |   |  |   |   |  |   |   |  |   |
| Diluted                earnings per common share |   | $                                                  | 744,652 |                                               |   | 7,395,848 |   | $ | 0.10 |   | $ | 527,347 |   |   | 4,989,065 |   | $ | 0.11 |   |

**(5)        Business segment information.**

| ***(In                thousands)***          |   | **Retail                Jewelry** |    | **Wholesale****Jewelry** |   | **Bullion** |   | **Rare                Coins** |    | **Auctions** |   | **Corporate                and Other** |   | **Consolidated** |    |
|----------------------------------------------|--------|-----------------------------------|---------|--------------------------|--------|-------------|--------|-------------------------------|---------|--------------|--------|----------------------------------------|--------|------------------|---------|
| Revenues                                     |   |                              |    |                     |   |        |   |                          |    |         |   |                                   |   |             |    |
| 2007                                         |   | $                                 | 12,153  |                     | $      | 3,948       |   | $                             | 12,027  |         | $      | 9,530                                  |   | $                | 1,037   |   | $ | 849 |   | $ | 39,544 |   |
| 2006                                         |   |                              | 10,885  |                     |   | 3,775       |   |                          | 13,117  |         |   | 3,659                                  |   |             | — |   |   | 279 |   |   | 31,715 |   |
|                                         |   |                              |    |                     |   |        |   |                          |    |         |   |                                   |   |             |    |   |   |   |   |   |   |   |
| Net                earnings (loss)           |   |                              |    |                     |   |        |   |                          |    |         |   |                                   |   |             |    |   |   |   |   |   |   |   |
| 2007                                         |   |                              | 325     |                     |   | 93          |   |                          | 132     |         |   | 34                                     |   |             | 164     |   |   | (3 | ) |   | 745 |   |
| 2006                                         |   |                              | 171     |                     |   | 113         |   |                          | 181     |         |   | 204                                    |   |             | — |   |   | (142 | ) |   | 527 |   |
|                                         |   |                              |    |                     |   |        |   |                          |    |         |   |                                   |   |             |    |   |   |   |   |   |   |   |
| Identifiable                assets           |   |                              |    |                     |   |        |   |                          |    |         |   |                                   |   |             |    |   |   |   |   |   |   |   |
| 2007                                         |   |                              | 12,004  |                     |   | 1,067       |   |                          | 355     |         |   | 3,339                                  |   |             | 1,814   |   |   | 983 |   |   | 19,562 |   |
| 2006                                         |   |                              | 9,102   |                     |   | 1,150       |   |                          | 300     |         |   | 266                                    |   |             | — |   |   | 741 |   |   | 11,559 |   |
|                                         |   |                              |    |                     |   |        |   |                          |    |         |   |                                   |   |             |    |   |   |   |   |   |   |   |
| Goodwill                                     |   |                              |    |                     |   |        |   |                          |    |         |   |                                   |   |             |    |   |   |   |   |   |   |   |
| 2007                                         |   |                              | — |                     |   | 837         |   |                          | — |         |   | —                                |   |             | — |   |   | 12,374 |   |   | 13,211 |   |
| 2006                                         |   |                              | — |                     |   | 837         |   |                          | — |         |   | —                                |   |             | — |   |   | — |   |   | 837 |   |
|                                         |   |                              |    |                     |   |        |   |                          |    |         |   |                                   |   |             |    |   |   |   |   |   |   |   |
| Capital                Expenditures          |   |                              |    |                     |   |        |   |                          |    |         |   |                                   |   |             |    |   |   |   |   |   |   |   |
| 2007                                         |   |                              | 106     |                     |   | —     |   |                          | — |         |   | —                                |   |             | — |   |   | 14 |   |   | 120 |   |
| 2006                                         |   |                              | 14      |                     |   | —     |   |                          | — |         |   | —                                |   |             | — |   |   | — |   |   | 14 |   |
|                                         |   |                              |    |                     |   |        |   |                          |    |         |   |                                   |   |             |    |   |   |   |   |   |   |   |
| Depreciation                and amortization |   |                              |    |                     |   |        |   |                          |    |         |   |                                   |   |             |    |   |   |   |   |   |   |   |
| 2007                                         |   |                              | 91      |                     |   | —     |   |                          | 18      |         |   | 18                                     |   |             | 18      |   |   | 51 |   |   | 196 |   |
| 2006                                         |   |                              | 67      |                     |   | —     |   |                          | — |         |   | —                                |   |             | — |   |   | 2 |   |   | 69 |   |

----

***DGSE        COMPANIES, Inc. and Subsidiaries***

**(5)        Business segment information. - **
***(continued)***

| ***(In                thousands)***          |   | **Retail                Jewelry** |    | **Wholesale****Jewelry** |   | **Bullion** |   | **Rare                Coins** |    | **Auctions** |   | **Corporate                and Other** |   | **Consolidated** |    |
|----------------------------------------------|--------|-----------------------------------|---------|--------------------------|--------|-------------|--------|-------------------------------|---------|--------------|--------|----------------------------------------|--------|------------------|---------|
| Revenues                                     |   |                              |    |                     |   |        |   |                          |    |         |   |                                   |   |             |    |
| 2007                                         |   | $                                 | 4,097   |                     | $      | 1,105       |   | $                             | 5,740   |         | $      | 4,908                                  |   | $                | 711     |   | $ | 295 |   | $ | 16,856 |   |
| 2006                                         |   |                              | 3,325   |                     |   | 1,472       |   |                          | 3,526   |         |   | 1,141                                  |   |             | — |   |   | 85 |   |   | 9,549 |   |
|                                         |   |                              |    |                     |   |        |   |                          |    |         |   |                                   |   |             |    |   |   |   |   |   |   |   |
| Net                earnings (loss)           |   |                              |    |                     |   |        |   |                          |    |         |   |                                   |   |             |    |   |   |   |   |   |   |   |
| 2007                                         |   |                              | 232     |                     |   | 27          |   |                          | 63      |         |   | 4                                      |   |             | 17      |   |   | (59 | ) |   | 284 |   |
| 2006                                         |   |                              | 18      |                     |   | 56          |   |                          | 31      |         |   | 38                                     |   |             | — |   |   | (35 | ) |   | 108 |   |
|                                         |   |                              |    |                     |   |        |   |                          |    |         |   |                                   |   |             |    |   |   |   |   |   |   |   |
| Identifiable                assets           |   |                              |    |                     |   |        |   |                          |    |         |   |                                   |   |             |    |   |   |   |   |   |   |   |
| 2007                                         |   |                              | 12,004  |                     |   | 1,067       |   |                          | 355     |         |   | 3,339                                  |   |             | 1,814   |   |   | 983 |   |   | 19,562 |   |
| 2006                                         |   |                              | 9,102   |                     |   | 1,150       |   |                          | 300     |         |   | 266                                    |   |             | — |   |   | 741 |   |   | 11,559 |   |
|                                         |   |                              |    |                     |   |        |   |                          |    |         |   |                                   |   |             |    |   |   |   |   |   |   |   |
| Goodwill                                     |   |                              |    |                     |   |        |   |                          |    |         |   |                                   |   |             |    |   |   |   |   |   |   |   |
| 2007                                         |   |                              | — |                     |   | 837         |   |                          | — |         |   | —                                |   |             | — |   |   | 12,374 |   |   | 13,211 |   |
| 2006                                         |   |                              | — |                     |   | 837         |   |                          | — |         |   | —                                |   |             | — |   |   | — |   |   | 837 |   |
|                                         |   |                              |    |                     |   |        |   |                          |    |         |   |                                   |   |             |    |   |   |   |   |   |   |   |
| Capital                Expenditures          |   |                              |    |                     |   |        |   |                          |    |         |   |                                   |   |             |    |   |   |   |   |   |   |   |
| 2007                                         |   |                              | 13      |                     |   | —     |   |                          | — |         |   | —                                |   |             | — |   |   | 3 |   |   | 16 |   |
| 2006                                         |   |                              | 13      |                     |   | —     |   |                          | — |         |   | —                                |   |             | — |   |   | — |   |   | 13 |   |
|                                         |   |                              |    |                     |   |        |   |                          |    |         |   |                                   |   |             |    |   |   |   |   |   |   |   |
| Depreciation                and amortization |   |                              |    |                     |   |        |   |                          |    |         |   |                                   |   |             |    |   |   |   |   |   |   |   |
| 2007                                         |   |                              | 38      |                     |   | —     |   |                          | 13      |         |   | 13                                     |   |             | 13      |   |   | 19 |   |   | 96 |   |
| 2006                                         |   |                              | 19      |                     |   | —     |   |                          | — |         |   | —                                |   |             | — |   |   | 1 |   |   | 20 |   |

----

***DGSE          COMPANIES, Inc. and Subsidiaries***

**(6)        Stock-based Compensation. **

**(7)        Acquisitions and Discontinued Operations.**

*Discontinued      Operations. *

----

***DGSE          COMPANIES, Inc. and Subsidiaries***

*Superior      Galleries, Inc. *

|                                     |   | Shares |      | Stock                Price |   | Extended                Price |   |
|------------------------------------------|--------|--------|-----------|----------------------------|--------|-------------------------------|--------|
| Common                stock              |   |   | 3,669,067 |                       | $      | 2.55                          |   | $ | 9,356,121 |   |
| A                warrants                |   |   | 845,634   |                       |   | 1.27(1                        | )      |   | 1,073,955 |   |
| B                warrants                |   |   | 863,000   |                       |   | 2.55                          |   |   | 2,220,650 |   |
| Exercise                Price B warrants |   |   | 863,000   |                       | $      | 0.001                         |   |   | (863 | ) |
| Direct                transaction costs  |   |   |      |                       |   |                          |   |   | 965,062 |   |
| Total                purchase price      |   |   |      |                       |   |                          |   | $ | 13,594,925 |   |

|                                     |   |   |       |
|------------------------------------------|--------|--------|------------|
| Goodwill                                 |   | $      | 12,374,035 |   |
| Property                and other assets |   |   | 1,068,958  |   |
| Inventory                                |   |   | 3,260,766  |   |
| Liabilities                assumed       |   |   | (3,108,834 | ) |
| Total                purchase price      |   | $      | 13,594,925 |   |

|                                                                  |   | **Three                Months Ended September 30,** |   | **Nine                Months Ended September 30,** |   |
|-----------------------------------------------------------------------|--------|-----------------------------------------------------|--------|----------------------------------------------------|--------|
| ***(In                thousands, except per share data)***            |   | **2007**                                            |   | **2006**                                           |   | **2007** |   | **2006** |   |
|                                                                  |   | **(Unaudited)**                                     |   | **(Unaudited)**                                    |   |
| Pro                forma total revenue                                |   | $                                                   | 16,856 |                                               | $      | 18,109 |   | $ | 50,142 |   | $ | 65,313 |   |
| Pro                forma net earnings (loss)                          |   |                                                | 284    |                                               |   | (830 | ) |   | (2,932 | ) |   | (1,678 | ) |
| Pro                forma net earnings per share — basic    |   | $                                                   | 0.03   |                                               | $      | (0.13 | ) | $ | (0.45 | ) | $ | (0.27 | ) |
| Pro                forma net earnings per share — diluted  |   | $                                                   | 0.03   |                                               | $      | (0.13 | ) | $ | (0.45 | ) | $ | (0.27 | ) |
| Pro                forma weighted average shares — basic   |   |                                                | 8,582  |                                               |   | 9,889 |   |   | 6,544 |   |   | 9,889 |   |
| Pro                forma weighted average shares — diluted |   |                                                | 10,393 |                                               |   | 9,962 |   |   | 7,396 |   |   | 9,960 |   |

----

***DGSE          COMPANIES, Inc. and Subsidiaries***

*Euless      Gold & Silver, Inc.*

**(8)        New Accounting Pronouncements**

**(9)        Recent Developments**

----

***DGSE          COMPANIES, Inc. and Subsidiaries***

**Item      2. Management’s Discussion and Analysis of Financial Condition and Results of      Operations.**

**Forward-Looking      Statements**

|  | · | uncertainties                regarding price fluctuations in the price of gold and other precious                metals; |
|--|--------|--------------------------------------------------------------------------------------------------------------------------|

|  | · | our                  ability to manage inventory fluctuations and                  sales; |
|--|--------|-------------------------------------------------------------------------------------------|

|  | · | changes                    in governmental rules and regulations applicable to the specialty                    financial services industry; |
|--|--------|----------------------------------------------------------------------------------------------------------------------------------------------|

|  | · | the                      results of any unfavorable litigation; |
|--|--------|-----------------------------------------------------------------|

|  | · |  interest                        rates; |
|--|--------|----------------------------------------------|

|  | · | economic                          pressures affecting the disposable income available to                          our                          customers; |
|--|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | · | our                            ability to maintain an effective system of internal                            controls; |
|--|--------|-------------------------------------------------------------------------------------------------------------------------|

|  | · | our                              ability to assimilate the operations of our recent                              acquisitions; |
|--|--------|--------------------------------------------------------------------------------------------------------------------------------|

|  | · |  the                                other risks detailed from time to time in our SEC                                reports. |
|--|--------|------------------------------------------------------------------------------------------------------------------------------------|

**Our      Business**

----

***DGSE        COMPANIES, Inc. and Subsidiaries***

**Recent      Developments**

**Significant      Accounting Policies**

*Inventory.*
** **

*Accounts      Receivable.*
** **

*Revenue      Recognition.*

----

***DGSE        COMPANIES, Inc. and Subsidiaries***

**Results      of Operations**

**Nine**
**      Months Ended September 30, 2007 compared to Nine Months Ended September 30,      2006**

**Three**
**      Months Ended September 30, 2007 compared to Three Months Ended September 30,      2006**

----

***DGSE        COMPANIES, Inc. and Subsidiaries***

**Liquidity      and Capital Resources**

----

***DGSE        COMPANIES, Inc. and Subsidiaries***

**Item      3. Quantitative and Qualitative Disclosures About Market      Risk.**

**Item      4. Controls and Procedures.**

*Evaluation      of disclosure controls and procedures*

*Changes      in internal controls.*

----

***DGSE        COMPANIES, Inc. and Subsidiaries***

**PART      II- OTHER INFORMATION**

**Item      1. Legal Proceedings **

----

***DGSE      COMPANIES, Inc. and Subsidiaries***

**Item      1A. Risk Factors.**

***Changes      in customer demand for our products and services could result in a significant      decrease in revenues.***

***Changes      in governmental rules and regulations applicable to the specialty financial      services industry could have a negative impact on our lending      activities.***

***Fluctuations      in our inventory turnover and sales.***

***Changes      in our liquidity and capital requirements could limit our ability to achieve      our      plans.***

***Changes      in competition from various sources could have a material adverse impact on      our      ability to achieve our plans.***

***Our      earnings could be negatively impacted by an unfavorable outcome of litigation,      regulatory actions, or labor and employment matters.***

----

***DGSE        COMPANIES, Inc. and Subsidiaries***

***A      failure in our information systems could prevent us from effectively managing      and controlling our business or serving our      customers.***

***A      failure of our internal controls and disclosure controls and procedures, or      our      inability to comply with the requirements of section 404 of the Sarbanes-Oxley      Act in a timely fashion could have a material adverse impact on us and our      investors’ confidence in our reported financial      information.***

***Changes      in general economic conditions could negatively affect loan performance and      demand for our products and services.***

***Interest      rate fluctuations could increase our interest      expense.***

***Our      success depends on our ability to attract, retain and motivate management and      other skilled employees.***

***The      voting power in our company is substantially controlled by a small number of      stockholders, which may, among other things, delay or frustrate the removal      of      incumbent directors or a takeover attempt, even if such events may be beneficial      to our stockholders.***

----

***DGSE        COMPANIES, Inc. and Subsidiaries***

***We      could be subject to sales taxes, interest and penalties on interstate sales      for      which we have not collected taxes.***

***We      may incur losses as a result of accumulating      inventory.***

***If      we experience an increase in the rescission of sales, our revenue and      profitability could decrease.***

***Our      planned expansion and enhancement of our website and internet operations may      not      result in increased profitability.***

***Our      websites may be vulnerable to security breaches and similar threats which could      result in our liability for damages and harm to our      reputation.***

----

***DGSE        COMPANIES, Inc. and Subsidiaries***

***Changes      to financial accounting standards and new exchange rules could make it more      expensive to issue stock options to employees, which would increase compensation      costs and may cause us to change our business      practices.***

***We      are subject to new corporate governance and internal control reporting      requirements, and our costs related to compliance with, or our failure to comply      with existing and future requirements could adversely affect our      business.***

***The      revolving credit facilities with Stanford International Bank Ltd. and Texas      Capital Bank, N.A. is each collateralized by a general security interest in      our      assets. If we were to default under the terms of either credit facility, the      lender would have the right to foreclose on our      assets.***

***We      have not paid dividends on our common stock in the past and do not anticipate      paying dividends on our common stock in the foreseeable      future.***

----

***DGSE        COMPANIES, Inc. and Subsidiaries***

**Item      4. Submission of Matters to a Vote of Security Holders.**

| **Proposal**                                                                                                                                                                                |   | **For**   |   | **Against** |   | **Abstain** |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------|--------|-------------|--------|-------------|
| Election                of the following directors to our board of directors:                                                                                                               |   |      |   |        |   |        |
|                                                                                                                                                                                        |   |      |   |        |   |        |
| Dr.                L.S. Smith, Ph.D                                                                                                                                                         |   | 5,803,479 |   | —     |   | 1,300       |
| William                H. Oyster                                                                                                                                                            |   | 5,803,479 |   | —     |   | 1,300       |
| Dr.                William P. Cordeiro, Ph.D.                                                                                                                                               |   | 5,803,479 |   | —     |   | 1,300       |
| Craig                Alan-Lee                                                                                                                                                               |   | 5,803,479 |   | —     |   | 1,300       |
| Richard                M. Gozia                                                                                                                                                             |   | 5,803,479 |   | —     |   | 1,300       |
| David                Rector                                                                                                                                                                 |   | 5,803,479 |   | —     |   | 1,300       |
|                                                                                                                                                                                        |   |      |   |        |   |        |
| To                ratify the selection of BKR Cornwell Jackson as our independent registered                public account firm for our fiscal year ending December 31,                2007 |   | 5,769,944 |   | 34,835      |   | —     |

**Item      5. Other Information.**

**Item      6.**
**Exhibits      and Reports on Form 8-K.**

**(a) Exhibits**

| **Exhibit** **No.** |   | **Description**                                                                                                                                      |   | **Filed** **Herein** |   | **Incorporated** **by****Reference** |   | **Form** |   | **Date                  Filed** **with                  SEC** |   | **Exhibit** **No.** |   |
|--------------------------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------|--------|-------------------------------------------|--------|----------|--------|--------------------------------------------------------------------|--------|--------------------------|--------|
|                     |   |                                                                                                                                                 |   |                      |   |                                      |   |     |   |                                                               |   |                     |   |
| 2.1                      |   | Amended                  and Restated Agreement and Plan of Merger and Reorganization, dated                  as of                  January 6, 2007 |   |                      |   | ×                                    |   | 8-K      |   | January                  9, 2007                                   |   | 2.1                      |   |
|                     |   |                                                                                                                                                 |   |                      |   |                                      |   |     |   |                                                               |   |                     |   |
| 2.2                      |   | Limited                  Joinder Agreement, dated as of January 6, 2007                                                                              |   |                      |   | ×                                    |   | 8-K      |   | January                  9, 2007                                   |   | 2.9                      |   |
|                     |   |                                                                                                                                                 |   |                      |   |                                      |   |     |   |                                                               |   |                     |   |
| 3.1                      |   | Articles                  of Incorporation dated September 17, 1965                                                                                  |   |                      |   | ×                                    |   | 8-A12G   |   | June                  23, 1999                                     |   | 3.1                      |   |
|                     |   |                                                                                                                                                 |   |                      |   |                                      |   |     |   |                                                               |   |                     |   |
| 3.2                      |   | Certificate                  of Amendment to Articles of Incorporation, dated October 14,                  1981                                      |   |                      |   | ×                                    |   | 8-A12G   |   | June                  23, 1999                                     |   | 3.2                      |   |
|                     |   |                                                                                                                                                 |   |                      |   |                                      |   |     |   |                                                               |   |                     |   |
| 3.3                      |   | Certificate                  of Resolution, dated October 14, 1981                                                                                   |   |                      |   | ×                                    |   | 8-A12G   |   | June                  23, 1999                                     |   | 3.3                      |   |

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***DGSE            COMPANIES, Inc. and            Subsidiaries***

|   |   |                                                                                                                                                                                          |   |   |   |   |   |   |   |                             |   |   |   |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|----------------------------------|--------|--------|--------|
| 3.4    |   | Certificate                  of Amendment to Articles of Incorporation , dated July 15,                  1986                                                                                 |   |   |   | × |   | 8-A12G |   | June                  23, 1999   |   | 3.4    |   |
|   |   |                                                                                                                                                                                          |   |   |   |   |   |   |   |                             |   |   |   |
| 3.5    |   | Certificate                  of Amendment to Articles of Incorporation, dated August 23,                  1998                                                                                |   |   |   | × |   | 8-A12G |   | June                  23, 1999   |   | 3.5    |   |
|   |   |                                                                                                                                                                                          |   |   |   |   |   |   |   |                             |   |   |   |
| 3.6    |   | Certificate                  of Amendment to Articles of Incorporation, dated June 26,                  1992                                                                                  |   |   |   | × |   | 8-A12G |   | June                  23, 1999   |   | 3.6    |   |
|   |   |                                                                                                                                                                                          |   |   |   |   |   |   |   |                             |   |   |   |
| 3.7    |   | Certificate                  of Amendment to Articles of Incorporation, dated June 26,                  2001                                                                                  |   |   |   | × |   | 8-K    |   | July                  3, 2001    |   | 1.0    |   |
|   |   |                                                                                                                                                                                          |   |   |   |   |   |   |   |                             |   |   |   |
| 3.8    |   | Certificate                  of Amendment to Articles of Incorporation, dated May 22,                  2007                                                                                   |   |   |   | x      |   | 8-K    |   | May                  31, 2007    |   | 3.1    |   |
|   |   |                                                                                                                                                                                          |   |   |   |   |   |   |   |                             |   |   |   |
| 3.9    |   | By-laws,                  dated March 2, 1992                                                                                                                                                 |   |   |   | × |   | 8-A12G |   | June                  23, 1999   |   | 3.7    |   |
|   |   |                                                                                                                                                                                          |   |   |   |   |   |   |   |                             |   |   |   |
| 4.1    |   | Specimen                  Common Stock Certificate                                                                                                                                            |   |   |   | × |   | S-4    |   | January                  6, 2007 |   | 4.1    |   |
|   |   |                                                                                                                                                                                          |   |   |   |   |   |   |   |                             |   |   |   |
| 10.1   |   | Renewal,                  Extension And Modification Agreement dated January 28, 1994, by                  and among                  DGSE Corporation and Michael E. Hall And Marian E. Hall |   |   |   | × |   | 10-KSB |   | March                  1995      |   | 10.2   |   |
|   |   |                                                                                                                                                                                          |   |   |   |   |   |   |   |                             |   |   |   |
| 10.2   |   | Lease                  Agreement dated June 2, 2000 by and between SND Properties and                  Charleston                  Gold and Diamond Exchange, Inc.                            |   |   |   | × |   | 10-KSB |   | March                  29, 2001  |   | 10.1   |   |
|   |   |                                                                                                                                                                                          |   |   |   |   |   |   |   |                             |   |   |   |
| 10.3   |   | Lease                  agreement dated October 5, 2004 by and between Beltline Denton                  Road                  Associates and Dallas Gold & Silver Exchange                 |   |   |   | × |   | 10-K   |   | April                  15, 2005  |   | 10.2   |   |
|   |   |                                                                                                                                                                                          |   |   |   |   |   |   |   |                             |   |   |   |
| 10.4   |   | Lease                  agreement dated December 1, 2004 by and between Stone Lewis Properties                  and                  Dallas Gold & Silver Exchange                         |   |   |   | × |   | 10-K   |   | April                  15, 2005  |   | 10.3   |   |
|   |   |                                                                                                                                                                                          |   |   |   |   |   |   |   |                             |   |   |   |
| 10.5   |   | Lease                  agreement dated November 18, 2004 by and between Hinkle Income                  Properties                  LLC and American Pay Day Centers, Inc.                     |   |   |   | × |   | 10-K   |   | April                  15, 2005  |   | 10.4   |   |

----

***DGSE            COMPANIES, Inc. and            Subsidiaries***

|   |   |                                                                                                                                                                             |   |   |   |   |   |   |   |                             |   |   |   |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|----------------------------------|--------|--------|--------|
| 10.6   |   | Lease                  Agreement dated January 17, 2005 by and between Belle-Hall Development                  Phase III Limited Partnership and DGSE Companies, Inc.            |   |   |   | × |   | S-4    |   | January                  6, 2007 |   | 10.6   |   |
|   |   |                                                                                                                                                                             |   |   |   |   |   |   |   |                             |   |   |   |
| 10.7   |   | Loan                  Agreement, dated as of December 22, 2005, between DGSE Companies,                  Inc. and                  Texas Capital Bank, N.A.                      |   |   |   | × |   | 8-K/A  |   | August                  17, 2006 |   | 10.1   |   |
|   |   |                                                                                                                                                                             |   |   |   |   |   |   |   |                             |   |   |   |
| 10.8   |   | Third                  Amendment to Loan Agreement, dated as of May 10, 2007, by and between                  DGSE                  Companies, Inc. and Texas Capital Bank, N.A. |   |   |   | × |   | 8-K    |   | May                  9, 2007     |   | 3.0    |   |
|   |   |                                                                                                                                                                             |   |   |   |   |   |   |   |                             |   |   |   |
| 10.9   |   | Support                  Agreement, DGSE stockholders, dated as of January 6, 2007                                                                                               |   |   |   | × |   | 8-K    |   | January                  9, 2007 |   | 99.1   |   |
|   |   |                                                                                                                                                                             |   |   |   |   |   |   |   |                             |   |   |   |
| 10.10  |   | Securities                  Exchange Agreement, dated as of January 6, 2007                                                                                                      |   |   |   | × |   | 8-K    |   | January                  9, 2007 |   | 99.2   |   |
|   |   |                                                                                                                                                                             |   |   |   |   |   |   |   |                             |   |   |   |
| 10.11  |   | Warrant                  to DiGenova, issued January 6, 2007                                                                                                                     |   |   |   | × |   | 8-K    |   | January                  9, 2007 |   | 99.3   |   |
|   |   |                                                                                                                                                                             |   |   |   |   |   |   |   |                             |   |   |   |
| 10.12  |   | Support                  Agreement, Superior stockholders, dated as of January 6,                  2007                                                                          |   |   |   | × |   | 8-K    |   | January                  9, 2007 |   | 99.5   |   |
|   |   |                                                                                                                                                                             |   |   |   |   |   |   |   |                             |   |   |   |
| 10.13  |   | Asset                  purchase agreement, dated May 9, 2007, by and between DGSE Companies,                  Inc.                  and Euless Gold & Silver, Inc.           |   |   |   | × |   | 8-K    |   | May                  9, 2007     |   | 1.0    |   |
|   |   |                                                                                                                                                                             |   |   |   |   |   |   |   |                             |   |   |   |
| 10.14  |   | Subordinated                  Promissory Note dated May 9, 2007                                                                                                                  |   |   |   | × |   | 8-K    |   | May                  9, 2007     |   | 2.0    |   |
|   |   |                                                                                                                                                                             |   |   |   |   |   |   |   |                             |   |   |   |
| 10.15  |   | Registration                  Rights Agreement with Stanford International Bank Ltd., dated as                  of May                  30, 2007                                 |   |   |   | × |   | 8-K    |   | May                  31, 2007    |   | 99.1   |   |
|   |   |                                                                                                                                                                             |   |   |   |   |   |   |   |                             |   |   |   |
| 10.16  |   | Corporate                  Governance Agreement with Dr. L.S. Smith and Stanford International                  Bank                  Ltd., dated as of May 30, 2007             |   |   |   | × |   | 8-K    |   | May                  31, 2007    |   | 99.2   |   |

----

***DGSE            COMPANIES, Inc. and            Subsidiaries***

|   |   |                                                                                                                                                                                                                                   |   |   |   |   |   |   |   |                          |   |   |   |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|-------------------------------|--------|--------|--------|
| 10.17  |   | Escrow                  Agreement with American Stock Transfer & Trust Company and Stanford                  International Bank Ltd., as stockholder agent, dated as of May                  30,                  2007             |   |   |   | × |   | 8-K    |   | May                  31, 2007 |   | 99.3   |   |
|   |   |                                                                                                                                                                                                                                   |   |   |   |   |   |   |   |                          |   |   |   |
| 10.18  |   | Form                  of Warrants                                                                                                                                                                                                      |   |   |   | × |   | 8-K    |   | May                  31, 2007 |   | 99.4   |   |
|   |   |                                                                                                                                                                                                                                   |   |   |   |   |   |   |   |                          |   |   |   |
| 10.19  |   | Amended                  and Restated Commercial Loan and Security Agreement, by and between                  Superior Galleries Inc. and Stanford International Bank Ltd., dated                  as of                  May 30, 2007 |   |   |   | × |   | 8-K    |   | May                  31, 2007 |   | 99.5   |   |
|   |   |                                                                                                                                                                                                                                   |   |   |   |   |   |   |   |                          |   |   |   |
| 10.20  |   | Employment                  Agreement with L.S. Smith, dated as of May 30, 2007                                                                                                                                                        |   |   |   | × |   | 8-K    |   | May                  31, 2007 |   | 99.6   |   |
|   |   |                                                                                                                                                                                                                                   |   |   |   |   |   |   |   |                          |   |   |   |
| 10.21  |   | Employment                  Agreement with William H. Oyster, dated as of May 30, 2007                                                                                                                                                 |   |   |   | × |   | 8-K    |   | May                  31, 2007 |   | 99.7   |   |
|   |   |                                                                                                                                                                                                                                   |   |   |   |   |   |   |   |                          |   |   |   |
| 10.22  |   | Employment                  Agreement with John Benson, dated as of May 30, 2007                                                                                                                                                       |   |   |   | × |   | 8-K    |   | May                  31, 2007 |   | 99.8   |   |
|   |   |                                                                                                                                                                                                                                   |   |   |   |   |   |   |   |                          |   |   |   |
| 31.1   |   | Certification                  pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934                  implementing Section 302 of the Sarbanes-Oxley Act of 2002 by Dr.                  L.S.                  Smith       |   | × |   |   |   |   |   |                          |   |   |   |
|   |   |                                                                                                                                                                                                                                   |   |   |   |   |   |   |   |                          |   |   |   |
| 31.2   |   | Certification                  pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934                  implementing Section 302 of the Sarbanes-Oxley Act of 2002 by John                  Benson                           |   | × |   |   |   |   |   |                          |   |   |   |
|   |   |                                                                                                                                                                                                                                   |   |   |   |   |   |   |   |                          |   |   |   |
| 32.1   |   | Certification                  pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section                  906 of                  the Sarbanes-Oxley Act of 2002 by Dr. L.S. Smith                                             |   | × |   |   |   |   |   |                          |   |   |   |
|   |   |                                                                                                                                                                                                                                   |   |   |   |   |   |   |   |                          |   |   |   |
| 32.2   |   | Certification                  pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section                  906 of                  the Sarbanes-Oxley Act of 2002 by John Benson                                                |   | × |   |   |   |   |   |                          |   |   |   |

**(b)      Reports on Form 8-K :**

----

**SIGNATURES**

| DGSE Companies, Inc. |                                                                  |   |   |
|----------------------|-----------------------------------------------------------------------|--------|--------|
|                 |                                                                  |   |   |   |
|                 |                                                                  |   |   |   |
| By:                  | /s/              L. S. Smith                                          |   |   | Dated:              November              14, 2007 |
|                 | L. S. SmithChairman of the Board,Chief Executive Officer andSecretary |   |   |  |

| By:    | /s/              L. S. Smith                                          |   |   | Dated:              November              14, 2007 |
|--------|-----------------------------------------------------------------------|--------|--------|----------------------------------------------------|
|   | L. S. SmithChairman of the Board,Chief Executive Officer andSecretary |   |   |

| By:    | /s/                W. H.                Oyster             |   |   | Dated:                November                14, 2007 |
|--------|------------------------------------------------------------|--------|--------|--------------------------------------------------------|
|   | W. H. OysterDirector, President andChief Operating Officer |   |   |

| By:    | /s/                  John                  Benson                |   |   | Dated:                  November                  14, 2007 |
|--------|------------------------------------------------------------------|--------|--------|------------------------------------------------------------|
|   | John BensonChief Financial Officer(Principal Accounting Officer) |   |   |

----