EXHIBIT 10.4

THIRD AMENDMENT TO LOAN AGREEMENT


THIS THIRD AMENDMENT TO LOAN AGREEMENT (hereinafter called this "Amendment")
is entered into as of June 28,1996, between Pizza Inn, Inc., a Missouri
corporation (the "Borrower") and Wells Fargo Bank (Texas), National
Association, formerly First Interstate Bank of Texas, N.A. (the "Bank").


W I T N E S S E T H:


WHEREAS, the Borrower, The Provident Bank ("Provident") and First
Interstate Bank of Texas, N.A. ("First Interstate"), for itself as a "Bank",
and as agent for itself and Provident, entered into a Loan Agreement dated as
of December 1, 1994 (hereinafter called the "Original Agreement"), whereby,
upon the terms and conditions therein stated, the Bank agreed to make
available to the Borrower a credit facility upon the terms and conditions set
forth in the Agreement; and

WHEREAS, the Borrower, Provident and First Interstate, for itself as a
"Bank", and as Agent for itself and Provident, entered into a First Amendment
to Loan Agreement, dated as of April 28, 1995 (the "First Amendment"); and

WHEREAS, Provident has transferred and assigned all of its right, title and
interest in and to the Agreement to First Interstate, such that First
Interstate is the sole remaining "Bank" as defined in the Agreement; and

WHEREAS, the Borrower and First Interstate, for itself as a "Bank", and as
Agent for itself and any other Banks, entered into a Second Amendment to Loan
Agreement, dated as of November 30, 1995 (the "Second Amendment") (the
Original Agreement, as amended by the First Amendment and the Second Amendment
is hereinafter referred to as the "Agreement"); and

WHEREAS, the Borrower and the Bank have agreed to certain amendments to the
Agreement;

WHEREAS, pursuant to the Agreement, Barko Realty, Inc., R-Check, Inc.
and Pizza Inn of Delaware, Inc. (collectively, the "Guarantors"), executed
that certain Guaranty Agreement dated as of December 1, 1994, pursuant to
which the Guarantors guaranteed the payment and performance of the
"Obligations", as defined in the Agreement;

NOW, THEREFORE, for and in consideration of the mutual covenants and
agreements herein contained, the parties to this Amendment hereby agree as
follows:

SECTION 1. Terms Defined in Agreement. As used in this Amendment, except
as may otherwise be provided herein, all capitalized terms which are defined
in the Agreement shall have the same meaning herein as therein, all of such
terms and their definitions being incorporated herein by reference.

SECTION 2. Amendments to Agreement. Subject to the conditions precedent
set forth in Section 3 hereof, the Agreement is hereby amended as follows:

(a) Section 1.1 of the Agreement is hereby amended by deleting from such
section the definition of "Consolidated Free Cash Flow" in its entirety and by
substituting the following lieu thereof:

"Consolidated Free Cash Flow" means, for any period, the aggregate net income
(or net loss) of the Borrower and the Subsidiaries on a consolidated basis
calculated before federal income taxes, depreciation and amortization but
after deducting Capital Expenditures, any Federal income taxes paid or payable
in cash by the Borrower and any extraordinary gains of the Borrower during the
period in question; provided, however, that for the purposes of determining
the Eurodollar Rate Margin only, the amount of any extraordinary losses during
the period in question shall be added thereto.

(b) Section 1.1 of the Agreement is further amended by deleting from such
section the definition of "Funded Debt Ratio" in its entirety and by
substituting the following lieu thereof:

"Funded Debt Ratio" means, at any time, the quotient determined by dividing
(a) the sum of all Debt and Capital Lease Obligations by (b) the Consolidated
Free Cash Flow less the amount of any purchases by Borrower of its common
stock in excess of $800,000 during the preceding twelve (12) calendar months.

(c) Section 10.1 of the Agreement is hereby amended by deleting such
section in its entirety and by substituting the following lieu thereof:

Section 10.1 Debt. The Borrower will not incur, create, assume, or permit to
exist, and will not permit any Subsidiary to incur, create, or permit to
exist, any Debt, except:
(a) Debt to the Banks pursuant to the Loan Documents;

(b) Existing Debt described on Schedule 3 hereto and any renewal or
extension thereof which does not increase the outstanding amount thereof;

(c) Debt of the Borrower to any Subsidiary and of any Subsidiary to the
Borrower or another Subsidiary; and

(d) Capital Lease Obligations and or purchase money Debt for purchases of
equipment in the ordinary course of business not exceeding $1,600,000 in the
aggregate at any one time.

(d) Section 11.2 of the Agreement is hereby amended by deleting such
section in its entirety and by substituting the following lieu thereof:

Section 11.2 Consolidated Net Worth. The Borrower will at all times
maintain Consolidated Net Worth in an amount not less than the sum of (a)
Seven Million Dollars ($7,000,000), and (b) fifty percent (50%) of the
cumulative total of all Consolidated Net Income earned in each successive
fiscal quarter, without deduction for any net loss incurred in any fiscal
quarter.

(e) Section 11.6 of the Agreement is hereby amended by deleting such
section in its entirety and by substituting the following lieu thereof:

Section 11.6 Funded Debt Ratio. From July, 1996, to and including November
1996, the Borrower will at all times maintain a Funded Debt Ratio of not
greater than 4.00 to 1.00. From and after December, 1996, the Borrower will
at all times maintain a Funded Debt Ratio of not greater than 3.50 to 1.00.

(f) Section 11.7 of the Agreement is hereby amended by deleting such
section in its entirety and by substituting the following lieu thereof:

Section 11.7 Fixed Charge Coverage Ratio. The Borrower will at all times
maintain a Fixed Charge Coverage Ratio of not less than 1.80 to 1.00.

SECTION 3. Conditions of Effectiveness.

(a) The Bank has relied upon the representations and warranties
contained in this Amendment in agreeing to the amendments to the Agreement set
forth herein and the amendments to the Agreement set forth herein are
conditioned upon and subject to the accuracy of each and every representation
and warranty of the Borrower made or referred to herein, and performance by
the Borrower of its obligations to be performed under the Agreement on or
before the date of this Amendment (except to the extent amended herein).

(b) The amendments to the Agreement set forth herein are further
conditioned upon receipt by the Bank of certificates of the Secretary or
Assistant Secretary of the Borrower setting forth resolutions of its Board of
Directors in form and substance reasonably satisfactory to the Bank with
respect to this Amendment.

SECTION 4. Representations and Warranties of the Borrower. The Borrower
represents and warrants to the Bank, with full knowledge that the Bank is
relying on the following representations and warranties in executing this
Amendment, as follows:

(a) The Borrower has corporate power and authority to execute,
deliver and perform this Amendment, and all corporate action on the part of
the Borrower requisite for the due execution, delivery and performance of this
Amendment has been duly and effectively taken.

(b) The Agreement as amended by this Amendment and the Loan Documents
and each and every other document executed and delivered in connection with
this Amendment to which the Borrower or any of its Subsidiaries is a party
constitute the legal, valid and binding obligations of the Borrower and any of
its Subsidiaries to the extent it is a party thereto, enforceable against such
Person in accordance with their respective terms.

(c) This Amendment does not and will not violate any provisions of
the articles or certificate of incorporation or bylaws of the Borrower, or any
contract, agreement, instrument or requirement of any Governmental Authority
to which the Borrower is subject. The Borrower's execution of this Amendment
will not result in the creation or imposition of any lien upon any properties
of the Borrower, other than those permitted by the Agreement and this
Amendment.

(d) The Borrower's execution, delivery and performance of this
Amendment do not require the consent or approval of any other Person,
including, without limitation, any regulatory authority or governmental body
of the United States of America or any state thereof or any political
subdivision of the United States of America or any state thereof.

(e) The monthly unaudited consolidated balance sheet of the Borrower
and its Subsidiaries as of May 26, 1996, the related consolidated statements
of earnings, capital accounts, and cash flows of the Borrower for the month
then ended and the consolidated balance sheet and related consolidated
statements of earnings, capital accounts and cash flows for the period
commencing the first day of the fiscal year and ending on the last day of such
month which have been furnished to the Bank, fairly present the financial
condition of the Borrower and its Subsidiaries as at such date and the results
of the operations of the Borrower and its Subsidiaries for the periods ended
on such date, all in accordance with GAAP applied on a consistent basis, and
since May 26, 1996, there has been no material adverse change in such
condition or operations.

(f) The Borrower has performed and complied with all agreements and
conditions contained in the Agreement required to be performed or complied
with by the Borrower prior to or at the time of delivery of this Amendment.

(g) After giving effect to this Amendment, no Default or Event of
Default exists and all of the representations and warranties contained in the
Agreement and all instruments and documents executed pursuant thereto or
contemplated thereby are true and correct in all material respects on and as
of this date.

(h) Nothing in this Section 4 of this Amendment is intended to amend
any of the representations or warranties contained in the Agreement or of the
Loan Documents to which the Borrower or any of the Subsidiaries is a party.

SECTION 5. Reference to and Effect on the Agreement.

(a) Upon the effectiveness of Sections 1 and 2 hereof, on and after
the date hereof, each reference in the Agreement to "this Agreement",
"hereunder", "hereof", "herein", or words of like import, shall mean and be a
reference to the Agreement as amended hereby.

(b) Except as specifically amended by this Amendment, the Agreement
shall remain in full force and effect and is hereby ratified and confirmed.

SECTION 6. No Waiver. Except as specifically amended hereby, the
Borrower agrees that no Event of Default and no Default has been waived or
remedied by the execution of this Amendment by the Bank and any such Default
or Event or Default heretofore arising and currently continuing shall continue
after the execution and delivery hereof.

SECTION 7. Cost, Expenses and Taxes. The Borrower agrees to pay on demand
all reasonable costs and expenses of the Bank in connection with the
preparation, reproduction, execution and delivery of this Amendment and the
other instruments and documents to be delivered hereunder, including
reasonable attorneys' fees and out-of-pocket expenses of the Bank. In
addition, the Borrower shall pay any and all stamp and other taxes and fees
payable or determined to be payable in connection with the execution and
delivery, filing or recording of this Amendment and the other instruments and
documents to be delivered hereunder, and agrees to save the Bank harmless from
and against any and all liabilities with respect to or resulting from any
delay in paying or omission to pay such taxes or fees.

SECTION 8. Extent of Amendments. Except as otherwise expressly provided
herein, the Agreement and the other Loan Documents are not amended, modified
or affected by this Amendment. The Borrower ratifies and confirms that (i)
except as expressly amended hereby, all of the terms, conditions, covenants,
representations, warranties and all other provisions of the Agreement remain
in full force and effect, (ii) each of the other Loan Documents are and remain
in full force and effect in accordance with their respective terms, and (iii)
the Collateral is unimpaired by this Amendment.

SECTION 9. Grant and Affirmation of Security Interest. The Borrower
hereby confirms and agrees that any and all liens, security interests and
other security or Collateral now or hereafter held by the Bank as security for
payment and performance of the Obligations hereby are renewed and carried
forth to secure payment and performance of all of the Obligations. The Loan
Documents are and remain legal, valid and binding obligations of the parties
thereto, enforceable in accordance with their respective terms.

SECTION 10. Guaranties. Each of the Guarantors hereby consents to and
accepts the terms and conditions of this Amendment, agrees to be bound by the
terms and conditions hereof and ratifies and confirms that its continuing
Guaranty Agreement, executed and delivered to the Bank as of December 1, 1994,
guaranteeing payment of the Obligations, is and remains in full force and
effect and secures payment of, among other things, the Note as renewed,
rearranged and extended hereby.

SECTION 11. Execution and Counterparts. This Amendment may be executed
in any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed and delivered shall be deemed to
be an original and all of which taken together shall constitute but one and
the same instrument. Delivery of an executed counterpart of the signature
page of this Amendment by facsimile shall be equally as effective as delivery
of a manually executed counterpart of this Amendment.

SECTION 12. Governing Law. This Amendment shall be governed by and
construed in accordance with the laws of the State of Texas.

SECTION 13. Headings. Section headings in this Amendment are included
herein for convenience and reference only and shall not constitute a part of
this Amendment for any other purpose.

SECTION 14. Arbitration Program. The parties agree to be bound by the
terms and provisions of the current Arbitration Program of First Interstate
Bank of Texas, N.A., which is incorporated by reference herein and is
acknowledged as received by the parties pursuant to which any and all disputes
arising hereunder, under the Agreement, under any of the other Loan Documents,
or under any of the documents and instruments contemplated thereby, or
pertaining hereto or thereto, shall be resolved by mandatory binding
arbitration upon the request of any party.

SECTION 15. NO ORAL AGREEMENTS. THE AGREEMENT (AS AMENDED BY THIS
AMENDMENT) AND THE OTHER LOAN DOCUMENTS, REPRESENT THE FINAL AGREEMENT BETWEEN
THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR CONTEMPORANEOUS
OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.

THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.

IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by their respective officers thereunto duly authorized.

BORROWER:

PIZZA INN, INC.

By:______________________________
Name:
Title:

BANK:

WELLS FARGO BANK (TEXAS), NATIONAL ASSOCIATION

By:______________________________
Name:
Title:

CONSENTED AND AGREED TO AS OF THIS 28TH DAY OF JUNE, 1996:

BARKO REALTY, INC.

By:___________________________
Name:
Title:

R-CHECK, INC.

By:____________________________
Name:
Title:

PIZZA INN OF DELAWARE, INC.

By:____________________________
Name:
Title: