WATERFORD GAMING, L.L.C.
                     WATERFORD GAMING FINANCE CORP.
                       12 % SENIOR NOTES DUE 2003
                WAIVER AND ACKNOWLEDGMENT OF NOTEHOLDER


     THIS WAIVER AND ACKNOWLEDGMENT (the "Waiver") is delivered to
Waterford Gaming, L.L.C., a Delaware limited liability company
("Company"), in connection with the 12 % Senior Notes due 2003 (the
"Notes"), issued by the Company and Waterford Gaming Finance Corp., a
Delaware corporation (together with the Company, the "Issuers"), under the
Indenture, dated as of November 8, 1996, among the Issuers and Fleet
National Bank, as Trustee ("Indenture").

     In consideration of the receipt of 1.5% (one hundred and fifty basis
points or $15) per $1,000 of the principal amount of Notes beneficially
owned by us (the "Fee"), the payment of which is subject to and
conditioned upon the terms set forth in paragraph 7 below, and other good
and valuable consideration in connection with our execution and delivery
of this Waiver to the Company, the undersigned hereby acknowledges,
declares and agrees as follows:

   1.  We are the beneficial owner of the aggregate outstanding
       principal amount of Notes set forth beside our name below.

   2.  We are familiar  with (i) the Indenture, (ii) the Relinquishment
       Agreement, dated as of February 7, 1998 ("Relinquishment Agreement"),
       between The Mohegan Tribal Gaming Authority (the "Authority") and 
       Trading Cove Associates ("TCA") and the letter of the same date among
       the Authority, The Mohegan Tribe of Indians of Connecticut (the 
       "Tribe"), the Company and Sun International Hotels Limited ("SIHL") 
       with respect to the Authority's Subordinated Notes due 2003 (the 
       "Letter"), (iii) the Development Services Agreement, dated February 7,
       1998, between the Authority, the Tribe and TCA (the "Development 
       Agreement") and (iv) the Side Letter relating to various waivers, 
       dated February 7, 1998 between the Authority and TCA (the "Waiver Side
       Letter," and together with the Relinquishment Agreement, the Letter 
       and the Development Agreement, the "Transaction Agreements").  We also
       are familiar with the content of Exhibit A hereto, an excerpt (the 
       "Excerpt") from an agreement among Sun Cove, Ltd. ("Sun Cove"), TCA and
       the Company (therein called "WG").

   3.  We acknowledge and agree that the Transaction Agreements and the
       Excerpt and the transactions contemplated thereby (including any 
       changes, amendments or modifications thereto that may be requested or
       required by the Bureau of Indian Affairs ("BIA") or the National 
       Indian Gaming Commission ("NIGC") as a result of it review of such 
       documents and transactions (the "Amendments")) do not, directly or 
       indirectly, terminate, amend or waive any provisions of an Operative 
       Document in a manner adverse to the economic interest of the Holders 
       (as such capitalized terms are defined in the Indenture), or otherwise
       violate or conflict with any provision of the Indenture.

   4.  We agree to waive compliance by the Company with any provision of the
       Indenture so as to allow the Company and/or TCA to agree to any 
       termination, amendment or waiver of any provision of any Operative
       Document consistent with the Transaction Agreements, and Excerpt and 
       the transactions contemplated thereby (including without limitation any
       Amendments).

   5.  We hereby acknowledge and agree that (i) the payment of the Fee does 
       not violate or conflict with any provisions of the Indenture and (ii)
       this is an irrevocable continuing instrument, binding on us and every
       subsequent transferee of all or any portion of the Notes, which we now
       beneficially own (including any Notes issued in exchange or replacement
       therefor, "our Notes"), whether or not notation regarding the content of
       this instrument is made on the Notes in their present global form or any
       future certificated form.  In addition, we consent to the making of any
       such appropriate notation, for notice purposes, by the Securities 
       Custodian or the Trustee (as such terms are defined in the Indenture).

   6.  We further understand that, in connection with the transactions
       contemplated by the Transaction Agreements, the Company may pay up to
       $5,000,000 to fund certain initial development expenses (the 
       "Development Expenses") and we hereby consent and agree that such 
       payment of Development Expenses complies with the provisions of the 
       Indenture in all respects and constitutes a permissible disbursement 
       of the Company under that certain Cash Collateral and Disbursement 
       Agreement, dated November 8, 1996, between and among Fleet National 
       Bank, as Trustee, Fleet National Bank, as Disbursement Agent and the 
       Company (the "Cash Collateral Agreement") and to the extent otherwise 
       required by the Indenture or the Cash Collateral Agreement, we hereby 
       waive any requirement that the Company comply with such agreements in 
       connection with the payment of the Development Expenses.

   7.  We understand that payment of the  Fee is subject to (i) receipt
       of approval of the Transaction Agreements from the BIA and the NIGC and
       (ii) the receipt by the Company of executed copies of this Waiver from
       beneficial holders of  the Notes representing at least 50% in aggregate
       principal amount of outstanding Notes on the date of execution hereof 
       (the foregoing clauses (i) and (ii) are referred to herein as the 
       "Requisite Approvals").  We further understand that we are required to
       return an executed version of this Waiver no later than April 6, 1998 
       (the "Termination Date") in order to receive the payment of the Fee.  
       We understand that the Company hereby agrees to pay to us, by wire 
       transfer in immediately available funds, in accordance with the payment
       provisions set forth in the Indenture, the Fee promptly upon the later 
       of (i) receipt of the Requisite Approvals and (ii) the Termination Date.
       We also understand that the Company is not obligated to, but may in its 
       sole discretion at anytime prior to the Termination Date, upon notice to
       the Trustee, extend the Termination Date.

   8.  In connection with our business, we hold an extensive portfolio
       of investment securities.  We have experience in the corporate debt
       market, have knowledge and experience in financial and business matters,
       and are capable of evaluating the merits and risks of investment in the
       Notes, taking into account the Transaction Agreements, and the Excerpt
       and the transactions contemplated thereby (including without limitation 
       any Amendments).  We have received and receive answers from the Issuers,
       concerning the Transaction Agreements and the information, including but
       not limited to copies of the Transaction Agreements, and have been
       provided with access by the Issuers to information and with the
       opportunity to ask questions of Excerpt and such contemplated 
       transactions (including, without limitation, any Amendments) and with
       the opportunity to obtain any additional information necessary to 
       verify the accuracy of the information obtained.

   9.  We acknowledge that we have performed our own investigation of
       the financial risks involved in delivering this instrument and are not
       relying upon Bear, Stearns & Co. Inc. or any other person to have
       conducted such investigation.

  10.  Recognizing that we are not the registered owner of our Notes,
       which along with the other Notes are registered with The Depository 
       Trust Company ("DTC") and held by a custodian in global form, we hereby
       instruct our nominee, whose name is set forth below, in its capacity as
       a DTC participant on our behalf, to sign below and to sign and deliver 
       such additional instruments as the Company or the Trustee may reasonably
       deem necessary and reasonably request or desirable in order to confirm 
       and carry out the purpose and intent of this instrument in regard to our
       Notes (including without limitation, any documents or instruments 
       necessary to cause the execution and deliveries of the DTC Omnibus 
       Proxy).


    $_____________________________________        ________________________
(Principal Amount of Notes Beneficially Owned)   (Name of Beneficial Owner)


Dated:__________________________   By:_______________________________
                                   Its:______________________________
    

   
ACKNOWLEDGED                       WATERFORD GAMING, L.L.C.
AND AGREED:

________________________________   By:  LMW Investments, Inc., member
[insert name of DTC participant]

By:___________________________     By:_____________________________
Its:__________________________     Its:____________________________

    

                                   By: Slavik Suites, Inc. member
     
                                   By:_____________________________
                                   Its:____________________________





                                                           EXHIBIT A
 
                                 To 
                     ACKNOWLEDGMENT OF NOTEHOLDER
                               EXCERPT

                                
Notwithstanding existing provisions of the TCA Partnership Agreement or
any other document regarding the payment of fees or distribution of cash
flow of TCA to its partners, if and only if the Relinquishment Agreement
has become effective, during the 7-year period beginning January 1, 2000,
WG will not be entitled to receive any fees or cash flow from TCA (with
the exception of: (i) the existing agreement regarding annual expenses of
TCA contained in the letter agreement dated October 19, 1996 among Sun
Cove, Slavik Suites, Inc. ("Slavik") and LMW Investments, Inc. ("LMW"),
not to exceed $2,000,000 a year ("Annual Expenses"); and (ii) WG's right
to receive $2,000,000 for use by it solely to pay such amount to Leisure
Resort Technology, Inc. ("Leisure") in 2003, or earlier if necessary,
pursuant to the Settlement and Release Agreement dated January 6, 1998
among Leisure, Lee R. Tyrol, TCA, Slavik, LMW, RJH Development Corp., WG
and Sun Cove) in any year until TCA has first paid Sun Cove consideration
in the amount of $5,000,000 in such year.