INTER-CREDITOR AGREEMENT

Exhibit 4.9

INTER-CREDITOR AGREEMENT

This INTER-CREDITOR AGREEMENT (the “Agreement”) is made and effective as of _____________, 2006, by and between the holders of the Unity Wireless Corporation 8% Senior Secured Convertible Debentures (“Existing Creditors”) and the New Creditors (as defined below), (the Existing Creditors and the New Creditors are collectively referred to as the “Creditors”).

RECITALS

WHEREAS, the Existing Creditors are the parties to that certain Securities Purchase Agreement dated February 27, 2006 and/or that certain additional issuance agreement of even date herewith (such securities purchase agreement and additional issuance agreement, collectively, the “Purchase Agreement”) by and between each Existing Creditors signatory thereto and Unity Wireless Corporation (the “Company”) and are the holders of those certain 8% Senior Secured Convertible Debentures due February 28, 2009 and __________, 2009, and issued on February 28, 2006 and __________, 2006, respectively, for an aggregate total principal amount up to $3,550,000 (the “Existing Indebtedness”), and the Existing Creditors are the beneficiaries of that certain Security Agreement dated February 27, 2006 (the “Security Agreement”) between the Company, its Subsidiaries and the Existing Creditors;

WHEREAS, pursuant to that certain Loan and Security Agreement dated  _____________, 2006, 2006 (the “Loan Agreement”), the investors signatory thereto (the “New Creditors”) will be loaning the Company up to $1,500,000, evidenced by 8% secured promissory notes due the earlier of (i) December 22, 2006 and (ii) the date the Company obtains the right to receive net proceeds of at least $1,500,000 in the aggregate in one or a series of debt or equity financings (the amounts owed pursuant to such Notes, the “New Indebtedness” and together with the Existing Indebtedness, the “Indebtedness”);

WHEREAS, the Existing Indebtedness is secured by all assets of the Company

WHEREAS, New Indebtedness will also be secured by all assets of the Company;

WHEREAS, the Creditors wish to memorialize their agreements concerning their respective rights, duties and obligations to one another with respect to the security interests granted under the Indebtedness.

NOW, THEREFORE, in consideration of the mutual covenants herein, their respective performances and benefits pertaining to the Indebtedness, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:

1.  

Ranking.

1.1

The Indebtedness shall rank in the following order of priority:  any sums secured or owed to the New Creditors pursuant to the New Indebtedness shall rank senior to amounts owed to the Existing Creditors, in proportion to such Creditor’s outstanding principal amounts of Indebtedness at any given time that a determination needs to be made of pro-rata holdings. For clarity, as of the date of this Agreement, the holdings of the Existing Creditors (collectively) are $3,450,000 and the senior holdings of the senior New Creditors (collectively) are $1,500,000.  Any Existing Indebtedness shall rank pari passu to any other Existing Indebtedness in proportion to each Existing Creditors then holdings of Existing Indebtedness.

1.2

If an Event of Default (as defined under any Indebtedness) occurs and any party hereto receives payment from the Company not in compliance with this Agreement, the other parties hereto shall be immediately notified and such payment shall be shared with all of the other Creditors in proportion to their respective pro-rata holdings as set forth above.

1.3

If an Event of Default occurs and any party hereto collects proceeds pursuant to its rights under any Indebtedness, the other parties shall be immediately notified and such payment shall be shared with all of the other Creditors as set forth above.

1.4     Notwithstanding any other provision in this Agreement, adjustments shall be made between the Creditors from time to time to reflect the fact that any contingent obligation taken into account as an obligation under the Indebtedness becomes satisfied or incapable of maturing into an actual obligation.

1.5    Each Existing Creditor and New Creditor is hereby authorized to file a UCC-1 in the jurisdictions set forth in, and pursuant to the terms of, the Security Agreement and Loan Agreement, respectively.

1.6    Notwithstanding anything to the contrary contained in the Purchase Agreement or  any document executed in connection with the New Indebtedness or the Existing Indebtedness and irrespective of: (i) the time, order or method of attachment or perfection of the security interests created in favor of Existing Creditors and the New Creditors, (ii) the time or order of filing or recording of financing statements or other documents filed or recorded to perfect security interests in any collateral; (iii) anything contained in any filing or agreement to which any Creditor now or hereafter may be a party; and (iv) the rules for determining perfection or priority under the Uniform Commercial Code or any other law governing the relative priorities of secured creditors, each Creditor acknowledg