<PAGE>
                                   EXHIBIT 4.8


                        JERICHO CO-DEVELOPMENT AGREEMENT

                                     BETWEEN

                             HEWLETT-PACKARD COMPANY
                                     ("HP")

                                       AND

                                   INDIGO N.V.
                                   ("INDIGO")






                                  CONFIDENTIAL



                                       1
<PAGE>
                        JERICHO CO-DEVELOPMENT AGREEMENT


THIS AGREEMENT is entered into on this 13th day of September, 2000 ("EFFECTIVE
DATE"), by and between HEWLETT-PACKARD COMPANY, a Delaware company with its
principal offices at 3000 Hanover Street, MS20-BT, Palo Alto, California 94304
("HP"), and INDIGO N.V., a Netherlands company with its principal offices at
Limburglaan 5, 6221 SH Maastricht, The Netherlands ("INDIGO").

WHEREAS, HP is engaged in the development, manufacture, marketing, sale and
service of computers, printers and other business and consumer products, and is
a leading global provider of computing and imaging solutions and services for
personal, office and enterprise applications, currently selling printers at
prices of up to approximately $10,000; and

WHEREAS, Indigo is engaged in the development, manufacture, marketing, sale and
service of Digital Offset Color(TM) printing and imaging products that
incorporate Indigo's proprietary, ink-based digital printing technology, at
prices of approximately $150,000 and above, for commercial and industrial
applications; and

WHEREAS, on November 17, 1998, the Parties entered into a Strategic Affiliation
Agreement pursuant to which the parties agreed, inter alia, to explore the
technical and economic feasibility of developing and selling digital color
printing products combining Indigo's and HP's technology and know-how for
applications not presently served by either firm, to identify the key "enablers"
necessary to achieve broad adoption of Indigo's technology in the corporate
enterprise environment, and to form a strategic technical alliance for exploring
such possible future products and applications; and

WHEREAS, the said feasibility exploration has been successfully completed, and
the Parties have concluded that, in collaboration with one another, they have
the opportunity to introduce products to serve production color printing and
publishing applications; and

WHEREAS, in order to capitalize upon such opportunities, the Parties wish to
enter into a commercial relationship to aggressively pursue the aforesaid
business opportunities by (a) HP's sale of certain Indigo products on an OEM
basis as more fully described in the OEM Agreement, (b) the joint development of
future products on the terms and conditions set forth in this Agreement; and (c)
an HP equity investment in Indigo as more fully described in the Stock Purchase
Agreement.


                                       2
<PAGE>
NOW THEREFORE, subject to the terms and conditions set forth herein, the Parties
agree as follows:

1.       DEFINITIONS

Capitalized terms used in this Agreement and not otherwise defined have the
meanings as follows:

"AFFILIATE" means, with respect to a Party, any Person controlling, controlled
by or under common control with such Party. Control of a Person shall mean the
ownership of 50% or more of the voting power of such Person.

"AGREEMENT" means this agreement and any Exhibits to this agreement.

"BACKGROUND IP" means Intellectual Property owned by a party as of the Effective
Date or developed or acquired by a Party after the Effective Date but during the
term of this Agreement, other than in the course of performing its obligations
under this Agreement.

"BPM" or "BRANDED PRODUCT MARGIN" means the Selling Price received by the
selling Party less the Product Cost of Goods Sold.

"CHANGE OF CONTROL" means (a) the acquisition of ownership, directly or
indirectly, beneficially or of record, by any Person or group (within the
meaning of the Securities Exchange Act of 1934 and the rules of the Securities
and Exchange Commission thereunder as in effect on the date of the change) other
than the other Party, an Affiliate of the other Party or the LFT (as defined in
the Stock Purchase Agreement), through one or more transactions, of shares
representing, upon the consummation, more than 33% of the aggregate ordinary
voting power represented by the issued and outstanding capital stock of a Party;
(b) occupation of a majority of the seats (other than vacant seats) on the board
of directors of a Party by Persons who were neither (i) nominated by the board
of directors of that Party nor (ii) appointed by directors so nominated; or (c)
the acquisition of the power, directly or indirectly, to direct or cause the
direction of the management or policies of a Party, whether through the ability
to exercise voting power, by contract or otherwise.

"CONSUMABLES" means ink (including imaging oil), image transfer blankets
(intermediate transfer members) and photo imaging plates (photoconductors).

"DERIVATIVE IP" means Intellectual Property developed pursuant to this Agreement
by either party, or by the parties jointly, that is a derivative or extension of
only one Party's Background IP. HP Derivative IP shall be deemed to include,
without limitation, the fields described in section 5.1 (HP Development
Component), and


                                       3
<PAGE>
Indigo Derivative IP shall be deemed to include, without limitation, the fields
described in section 5.2 (Indigo Development Component).

"HP JERICHO R&D" has the meaning set forth in section 5.1 below.

"FOREGROUND IP" means Intellectual Property developed pursuant to this Agreement
that does not constitute Derivative IP.

"INITIAL JERICHO PRODUCT" means the first Jericho Product to be developed.

"INSOLVENCY EVENT" means the occurrence of any of the following:

         (a) An involuntary proceeding is commenced or an involuntary petition
         shall be filed seeking (i) liquidation, reorganization or other relief
         in respect of a Party or its debts, or of a substantial part of its
         assets, under any Federal, state or foreign bankruptcy, insolvency,
         receivership or similar law now or hereafter in effect or (ii) the
         appointment of a receiver, trustee, custodian, sequestrator,
         conservator or similar official for a Party or for a substantial part
         of its assets, and, in any such case, such proceeding or petition shall
         continue undismissed for 120 days or an order or decree approving or
         ordering any of the foregoing shall be entered.

         (b) A Party shall (i) voluntarily commence any proceeding or file any
         petition seeking liquidation, reorganization or other relief under any
         Federal, state or foreign bankruptcy, insolvency, receivership or
         similar law now or hereafter in effect, (ii) consent to the institution
         of, or fail to contest in a timely (i.e., as imposed by applicable law)
         and appropriate manner, any proceeding or petition described in clause
         (a) above, (iii) apply for or consent to the appointment of a receiver,
         trustee, custodian, sequestrator, conservator or similar official for a
         Party or for a substantial part of its assets, (iv) file an answer
         admitting the material allegations of a petition filed against it in
         any such proceeding, (v) make a general assignment for the benefit of
         creditors or (vi) take any action for the purpose of effecting any of
         the foregoing.

         (c) A Party shall become unable, admit in writing or fail generally to
         pay its debts as they become due.

"INTELLECTUAL PROPERTY" or "IP" means rights in unpatented inventions, patent
applications, patents, design rights, copyrights (including, without limitation,
rights in computer software), know-how and other trade secret rights and all
other rights or forms of protection of a similar nature or having equivalent or
similar effect to any of these rights (but excluding trademark rights), whether
or not any of these rights is


                                       4
<PAGE>
registered, and including, without limitation, applications for registration of,
and rights to apply for, any such rights.

"JERICHO ENGINE" means any printing device that uses Indigo Core Technology,
provided however that current Indigo products incorporating Indigo Core
Technology as well as future Indigo products incorporating Indigo Core
Technology based on a "clean sheet" design (i.e., a design using substantially
different components from those developed pursuant to this Agreement), shall not
be deemed to include a Jericho Engine.

"JERICHO FIELD OF USE" means development, manufacture, importation and supply of
Jericho Products, including the right to have manufactured, have imported, or
have supplied such Jericho Products via third parties.

"JERICHO KNOW-HOW" means know-how developed pursuant to this Agreement required
to develop, manufacture, or service Jericho Products.

"JERICHO PRODUCTS" means any products that incorporate a Jericho Engine. Jericho
Products include all relevant spare parts and Consumables.

"MATERIAL BREACH" has the meaning set forth in section 12.1 below.

"NON-JERICHO PRODUCTS" means, in the case of Indigo, Indigo products other than
Jericho Products that use the Indigo Core Technology and in the case of HP, to
the extent applicable, HP's inkjet and dry toner products.

"OEM AGREEMENT" means the agreement of that name entered into by the Parties on
the Effective Date.

"OPM" or "OEM PRODUCT MARGIN" means the Selling Price received by either HP or
Indigo from the third party OEM less the Product Cost of Goods Sold.

"PARTY" means either HP or Indigo (as the case may be) and "PARTIES" means both
HP and Indigo.

"PERSON" means an individual, partnership, corporation (including a business
trust), limited liability company, joint stock company, trust, unincorporated
association, sole proprietorship, joint venture, government (or any agency or
political subdivision thereof) or other entity.

"PRINTER EQUIPMENT VENDORS" means entities that primarily sell printers or other
hardware products/services to end-users.


                                       5
<PAGE>
"PRODUCT COST OF GOODS SOLD" OR "PCOGS" means all costs of goods incurred,
directly, or indirectly through third parties, by HP or Indigo in the
manufacture, freight, installation, operator training and free warranty of the
Jericho Products.

"SELLING PRICE" means the actual (unbundled) arm's-length selling price
(including for sales to OEMs). If a product is sold to a customer in connection
with a broader package (e.g., clicks, lease, rental, maintenance or other
services), it will be deemed to have been sold at the average price over the
previous 3 months for similar unbundled products.

"STOCK PURCHASE AGREEMENT" means the agreement of that name entered into by the
Parties on the Effective Date.

"SUPPLIES RESELLERS" means entities that primarily sell or distribute supplies.

"INDIGO CORE TECHNOLOGY" means technology which allows the creation of a printed
image employing a liquid composition of charged, pigmented thermoplastic
particles capable of being transferred from an image-bearing surface to a final
substrate.

"INDIGO JERICHO R&D" has the meaning set forth in section 5.2 below.

2.       JERICHO PRODUCTS

2.1      Basic Nature. HP and Indigo will, as set forth in this Agreement,
cooperate in the development over time of a family of low cost digital color
printers, not presently produced or capable of being produced by either Party
independently through the joint undertaking of research and development within a
framework of a defined work program set forth in this Agreement.

2.2      Technological Basis. Jericho Products will be based upon the Indigo
Core Technology. The Indigo Core Technology shall be further developed,
engineered and productized using HP's extensive experience in leading edge
printing and imaging technologies and Indigo's extensive experience in digital
offset color printing.

3.       JERICHO PRODUCT SPECIFICATIONS

3.1      Preparation of Initial Jericho Product Specification. HP shall prepare,
at its sole expense and based upon consultation with Indigo, all aspects of the
product specifications for the Initial Jericho Product, setting out all
technical and functional specifications therefor. HP shall use commercially
reasonable efforts to complete the specifications for the initial Jericho
Product within 90 days of the Effective Date. The Parties will collaborate to
discuss and jointly develop an understanding of the potential applications and
customer needs.


                                       6
<PAGE>
3.2      New Jericho Products. Either Party shall have the right (but neither
Party shall have the obligation), from time to time, to suggest new Jericho
Products or further Jericho Product R&D, by submitting a proposal in writing to
the other Party, attaching draft product specifications for the new Jericho
Product or R&D objectives, as the case may be. The Parties shall consider and
discuss each such proposal in good faith. HP shall have the right, in its sole
discretion, to adopt or decline any such proposal. If any such proposal is so
adopted, the Parties shall attempt to reach agreement on such specifications or
R&D objectives. To the extent the Parties are unable to agree on such
specifications or R&D objectives within 90 days of commencement of discussions
(or such longer period as may be agreed), HP's version of the specifications
shall be adopted and the new Jericho Products or further Jericho Product R&D
shall be developed based on such specifications together with the relevant
statement of work and project plan.

4.       JERICHO PRODUCT DEVELOPMENT

4.1      Statement of Work and Project Plan. After agreement is reached
regarding product specifications, the parties shall work together to develop a
statement of work and project plan for the full-scale development, including the
production of a prototype, of the relevant Jericho Product.

5.       DEVELOPMENT AND FUNDING RESPONSIBILITIES

5.1      HP Development Component . HP shall lead the research into and
development of the formatter and system for Jericho Products, and will carry out
supplemental activities (including those of HP Labs) that HP agrees to do in
support of Indigo's Jericho R&D ("HP JERICHO R&D"), and shall be solely
responsible for funding thereof.

5.2      Indigo Development Component. Simultaneously with the HP development
set forth above, Indigo shall lead the research into and development of the ink
and engine (generally those sub-systems and components that "touch" the ink or
are involved in the process steps of image creation) for Jericho Products, which
development shall be conducted primarily in Israel ("INDIGO JERICHO R&D") and
funded dollar-for-dollar in accordance with the funding obligations set forth
below.

5.3      Access to Know-How. Each Party will provide the other with access to
that Party's know-how to the extent necessary to perform its research and
development component under this Agreement.

5.4      HP Funding of Indigo Jericho R&D for Initial Jericho Product. The
Parties expect the full scale research and development program for the Initial
Jericho


                                       7
<PAGE>
Product to take three (3) years, with the commercial sale of such Initial
Jericho Product expected to commence in the first calendar quarter of 2004. HP's
funding of Indigo Jericho R&D for the Initial Jericho Product shall be as
follows:

         5.4.1   Payment of $5m no later than January 1, 2001.

         5.4.2   Payment of $3.75m no later than January 1, 2002.

         5.4.3   Payment of $3.75m no later than 10 days after the go/no go
         checkpoint of June 30, 2002 (provided HP elects to "go" at that
         checkpoint).

         5.4.4   Payment of $12.5m no later than January 1, 2003 (provided HP
         elects to "go" at the June 30, 2002 checkpoint).

5.5      Indigo Funding of Indigo Jericho R&D for Initial Jericho Product.
Indigo shall match, dollar-for-dollar, the aforesaid HP funding of Indigo
Jericho R&D.

5.6      Go/ No Go Checkpoints. Notwithstanding the foregoing payment schedule,
there shall be go/no go checkpoints on June 30, 2002 and on September 30, 2003,
at which checkpoints HP may in its absolute discretion decide to terminate the
Agreement. If HP so terminates on June 30, 2002, it shall have no obligation to
make any further payments beyond that date, except for fair "exit charges"
payable to Indigo. If HP so terminates on September 30, 2003, it shall incur no
additional exit charges. In such event, all Indigo exit expenses shall be deemed
to have been covered by HP's prior payment of $12.5m for Indigo Jericho R&D
during calendar year 2003.

5.7      Personnel. Throughout the term of the Indigo research and development
effort, an estimate of 10 technical experts employed by HP shall, at HP's
expense, be stationed on a full-time basis at Indigo's premises in Israel (the
"RELOCATED PERSONNEL"). The Relocated Personnel shall have experience in fields
to be determined by mutual agreement of the Parties, it being anticipated that
such fields will likely range from color science and imaging to project
management, testing and value engineering. The Relocated Personnel shall comply
with all relevant Indigo policies regarding safety, security and other work
practices.

5.8      Funding for New Jericho Product Development and Further Jericho Product
R&D. The Parties shall fund all new Jericho Products and all further Jericho
Product R&D which the Parties undertake pursuant to section 3.2. It is the
intention of the Parties that such funding be allocated between the Parties in
the same ratio as in the Initial Jericho Product research and development
period, with HP funding HP Jericho R&D, as well as one-half of the Indigo
Jericho R&D, payable annually in advance and otherwise as set forth below in
this section 5.8. From the time the


                                       8
<PAGE>
original $50 million R&D funding for the Initial Jericho Product is spent, the
Parties will agree an annual Indigo Jericho R&D budget to be at least 2 x 5% of
Indigo's total revenue from HP and all other Indigo revenue from Jericho Product
sales during the prior calendar year. To the extent that 5% of Indigo's
aforesaid prior year's revenue is inadequate to cover 50% of the jointly-agreed
Indigo Jericho R&D budget, HP will fund not only its 50% share of said R&D
budget but will also fund 100% of the shortfall, with the amount of such
shortfall to be credited against HP's R&D commitment in future years.

6.       MANUFACTURING

6.1      Commencement of Jericho Product Manufacturing. Once the Parties agree
that a prototype meets the relevant product specifications, commercial
manufacturing of the relevant Jericho Product shall commence. If the Parties are
unable to agree as aforesaid, HP's view shall prevail.

6.2      Ink Manufacturing. All ink manufacturing for the Jericho Product shall
be done by Indigo and the first ink manufacturing plant for the Jericho Product
shall be established in Israel. Subsequent ink plants will be built in other
geographical locations if necessary.

6.3      Long-Term Manufacturing of Other Consumables. If, at any time, in
either Party's reasonable opinion, it becomes necessary to manufacture
Consumables (other than ink) for Jericho Products in any locations other than
Israel, the Parties shall, in consultation with one another, have the right to
specify the new locations where such Consumables should be manufactured, and the
manufacturer thereof. In making their determination, the Parties will give
particular consideration to the value and secrecy of the Indigo know-how
utilized in manufacturing the said Consumables with a view to maximizing the
protection of Indigo's Intellectual Property.

6.4      Long-Term Manufacturing Strategy. The Parties shall regularly review,
restructure, and/or relocate manufacturing of Jericho Products (other than ink)
as reasonably necessary to give effect to HP's strong preference for the
manufacture of Jericho Products by global third party contract manufacturers ,
focused on pursuing low manufacturing cost, high quality, access to tax havens,
operational hedging, and low supply chain cost with the strategy to cover all
manufacturing capacity investments necessary to create a manufacturable product
(tooling, production prototypes, etc.) in the per unit product cost of goods
sold, leveraging from the existing infrastructure of the third party.

6.5      Minimization of Manufacturing Costs. If, at any time, HP is able to
reasonably evidence that, either by itself or using third parties, it can
manufacture any or all components of the Jericho Products (other than ink)
significantly more cost


                                       9
<PAGE>
effectively than may then be manufactured by Indigo (or the then current
manufacturer), HP shall, in consultation with Indigo, have the right, over a
reasonable period, to transfer such manufacturing to itself or such third party,
as the case may be. In making a decision to transfer manufacturing, HP must make
provision for recovery over a reasonable period of reasonable sunk costs
invested by Indigo in the manufacturing process as part of the proposal to
transfer manufacturing.

6.6      Funding of Manufacturing Infrastructure. The Parties agree that the
Party undertaking any component of manufacturing pursuant to this Agreement will
be responsible for the funding of the manufacturing plant and infrastructure
needed to carry out such manufacturing.

7.       BRANDING AND SALES OF JERICHO PRODUCTS

7.1      Branding. Each Party shall have the right to brand the Jericho Products
with its own brand, but without reference to the other Party unless the other
Party consents in writing.

7.2      Direct Sales. Each Party shall have the right to sell its own-branded
Jericho Products for any application and in any geographical territory in the
world.

7.3      OEM Channel.

         7.3.1   Vertical Applications. Each Party shall have the right to OEM
         Jericho Products into Vertical Applications. When used in this section
         7.3.1, the term "VERTICAL APPLICATIONS" shall mean applications outside
         of commercial printing, publishing, in-house/corporate printing and
         photofinishing.

         7.3.2   Non-Vertical Applications. Neither Party may OEM the Jericho
         Products into Non-Vertical Applications without the prior written
         consent of the other Party, such consent not to be unreasonably
         withheld. When used in this section 7.3, the term "NON-VERTICAL
         APPLICATIONS" shall mean commercial printing, publishing,
         in-house/corporate printing and photofinishing.

8.       CONSUMABLES

To ensure efficient distribution, quality control, and operation of Jericho
Products, Consumables shall be designed, manufactured, and branded to the
specifications of each Party and shall be uniquely compatible with the Jericho
Products supplied to end users by such Party.


                                       10
<PAGE>
9.       MAINTENANCE, SUPPORT, DELIVERY, INSTALLATION, AND TRAINING ("SERVICES")

9.1      Control. Each Party shall determine the nature, scope, and pricing of
all Services it decides to provide to its customers with respect to the Jericho
Products.

10.      MARGIN SHARING

10.1     HP and Indigo Branded Sales.

         10.1.1   Direct Sales. The Parties shall share Branded Product Margin
         (BPM) derived from direct sales (i.e., sales in respect of which the
         Party invoices the end user) of Jericho Products as follows:

<TABLE>
<CAPTION>
                                  HP Branded      HP Branded     Indigo Branded    Indigo Branded
        -----------------------------------------------------------------------------------------
                                   HP BPM %      Indigo BPM %       HP BPM %        Indigo BPM %
        -----------------------------------------------------------------------------------------
<S>                               <C>            <C>             <C>               <C>
        Branded Jericho               70%            30%              30%                70%
        Product (excluding
        Consumables)
        -----------------------------------------------------------------------------------------
        Consumables for               70%            30%              30%                70%
        respective branded
        Jericho Product
        -----------------------------------------------------------------------------------------
</TABLE>

         10.1.2   Indirect Sales. The Parties shall share BPM derived from
         indirect sales (i.e. sales, other than OEM sales described in section
         10.2, in respect of which the Party does not invoice the end user) of
         Jericho Products as follows:

<TABLE>
<CAPTION>
                                  HP Branded      HP Branded     Indigo Branded    Indigo Branded
        -----------------------------------------------------------------------------------------
                                   HP BPM %      Indigo BPM %       HP BPM %        Indigo BPM %
        -----------------------------------------------------------------------------------------
<S>                               <C>            <C>             <C>               <C>
        Branded Jericho               50%                50%                 50%                 50%
        Product (excluding
        Consumables)
        -----------------------------------------------------------------------------------------
</TABLE>


                                       11
<PAGE>
<TABLE>
<S>                               <C>            <C>             <C>               <C>
        Consumables sold              70%                30%                 30%                 70%
        through Supplies
        Resellers
        -----------------------------------------------------------------------------------------
        Consumables sold              50%                50%                 50%                 50%
        through Printer
        Equipment Vendors
        -----------------------------------------------------------------------------------------
</TABLE>

10.2     Third Party OEM Sales. The Parties shall share OEM Product Margin (OPM)
derived from sales of Jericho Products supplied by third party OEMs as follows:

<TABLE>
<CAPTION>
        3rd-party
        branded OEM
        ----------------------------------------------------
                                    HP OPM%      Indigo OPM%
        ----------------------------------------------------
<S>                                 <C>          <C>
        OEM Jericho Product           50%            50%
        (excluding
        Consumables)
        ----------------------------------------------------
        OEM Consumables               50%            50%
        ----------------------------------------------------
</TABLE>

10.3     Payment Procedures. The Parties shall establish an operating procedure
for implementation of the margin sharing formula, whereby ongoing payments are
made monthly, within fifteen business days of the end of each month, and
adjustments, if needed, being made quarterly. The following is an example of the
application of the BPM sharing formula for direct sales:

If HP were to sell to a customer, at a Selling Price of $100, HP-branded
consumables manufactured by INDIGO at a total PCOGS of $30, the BPM would be
$100 - $30 = $70.
HP would retain 70% of $70 = $49.
HP would pay INDIGO $51 (consisting of $30 in COGS plus Indigo's share of the
BPM, i.e., 30% of $70 = $21).

10.4     Right of Audit. Each Party shall make its relevant books and records
available at reasonable times, but not more frequently than once a year, to an
independent auditor appointed by the other Party at its expense, and approved by
the Party to be audited (acting reasonably), and shall allow the auditor to
conduct an


                                       12
<PAGE>
audit to establish compliance with the above payment and revenue sharing
obligations.

11.      INTELLECTUAL PROPERTY

11.1     Background IP.

         11.1.1  Ownership. Ownership of Background IP shall not be affected by
         this Agreement.

         11.1.2  Cross Licenses; Sublicensing. Each Party agrees to grant and
         hereby grants to the other Party a world wide, non-exclusive, royalty
         free, irrevocable (except as provided in section 12.4 below), perpetual
         license to use the grantor's Background IP solely within the Jericho
         Field of Use, provided however that such license shall not grant HP the
         right to manufacture ink (except as provided in section 12.4.1(b)).

11.2     Derivative IP.

         11.2.1  Ownership. Derivative IP shall be owned by the Party owning the
         Background IP on which it is based. To the extent necessary to
         implement the foregoing, each party hereby quitclaims and assigns all
         of its right, title and interest in such Derivative IP to its
         designated owner as set forth above, and covenants to execute any
         documents and perform any acts necessary to perfect the designated
         owner's title therein.

         11.2.2  Cross-Licenses; Sublicensing. Each Party agrees to grant and
         hereby grants to the other Party a world wide, non-exclusive, royalty
         free, irrevocable (except as provided in section 12.4 below) perpetual
         license to use the grantor's Derivative IP solely: (a) within the
         Jericho Field of Use; and (b) in its Non-Jericho Products, provided
         however that such license shall not grant HP the right to manufacture
         ink (except as provided in section 12.4.1(b)).

11.3     Foreground IP.


                                       13
<PAGE>
         11.3.1  Ownership. Foreground IP developed solely by a Party shall be
         solely owned by the developing Party. Foreground IP developed jointly
         by the Parties shall be jointly owned. Each Party will provide
         reasonable assistance to the other Party in connection with enforcement
         proceedings brought by the other Party in connection with jointly owned
         Foreground IP.

         11.3.2  Cross Licenses; Sublicensing. Each Party agrees to grant and
         hereby grants to the other Party a world wide, non-exclusive, royalty
         free, irrevocable (except as provided in section 12.4 below) perpetual
         license to use the grantor's solely owned Foreground IP solely: (a)
         within the Jericho Field of Use; and (b) in its Non-Jericho Products,
         provided however that such license shall not grant HP the right to
         manufacture ink (except as provided in section 12.4.1(b)).

11.4     Warranty and Indemnity. Each Party warrants that it owns or has the
unrestricted right to license all Intellectual Property licensed by it under
this Agreement and will defend and indemnify the licensee and its distributors
and its customers against third party Intellectual Property infringement claims
arising from the licensee's permitted use of any technical information provided
by it, provided that the infringement would not have arisen but for the use of
such technical information; provided however, the foregoing obligation to defend
and indemnify shall not apply where the alleged infringement: (a) arose as a
result of the indemnified party's misuse of such technical information; (b)
arose from unauthorized modification of such technical information; or (c) such
technical information was created solely as a result of the other Party's
specification.

11.5     Trademarks. Each of the Parties acknowledges the other's exclusive
ownership of its trademarks, and declares that neither Party shall acquire
rights in the other's trademarks by virtue of anything contained in this
Agreement. Each Party agrees not to file applications for registration of
trademarks that are the same or similar to the other Party's trademarks nor to
challenge the exclusive rights of the other in such trademarks.

12.      TERM AND TERMINATION

12.1     Definitions.

"MATERIAL BREACH" means the failure of a Party to perform any substantial and
material obligation imposed upon said Party in this Agreement and to cure such
failure within ninety (90) days of receipt of written notice thereof from the
other Party. For the avoidance of doubt, a Material Breach includes, but is not
limited to the following:


                                       14
<PAGE>
         (i)   failure to meet funding commitments pursuant to sections 5.4,
         5.5, and 5.8;

         (ii)  failure to staff the development of a Jericho Product, pursuant
         to sections 4.1, 5.1 and 5.2, with a reasonable number of full-time
         employees collectively having the appropriate skill sets, subject, in
         the case of Indigo, to the funding constraints described in section 5;

         (iii) failure to make good faith efforts to perform the assigned duties
         under the applicable statement of work referred to in section 4.1 or
         the development component described in sections 5.1 and 5.2; and

         (iv)  failure to allow auditing pursuant to section 10.4.

12.2     Term. Subject to the Party's rights of termination set forth in this
Agreement, the term of this Agreement shall be 20 years from the Effective Date,
subject to renewal by HP at its sole option for two successive five year
extension terms.

12.3     Termination Events.

         12.3.1  Neither Party shall have the right to terminate this Agreement
         except upon the occurrence of any of the following events:

         (i)   a Material Breach by the other Party;
         (ii)  an Insolvency Event involving the other Party
         (iii) a Change of Control of the other Party; or
         (iv)  in the case of HP only, a unilateral right of termination at a
               go/no go checkpoint pursuant to section 5.6.

         12.3.2  Each Party shall ensure that the provisions of this section 12
         are binding on its successors and permitted transferees and assigns.

         12.3.3  Each Party shall give the other Party written Notice,
         personally delivered to the other Party, within two days of any Change
         of Control.

12.4     Termination Consequences.

         12.4.1  Termination for Material Breach or Insolvency. If either Party:
         (a) commits a Material Breach; or (b) is the subject of an Insolvency
         Event; and the other Party (the "TERMINATING PARTY") terminates this
         Agreement based thereon:


                                       15
<PAGE>
         (a)  the first mentioned Party ("TERMINATED PARTY") shall lose all
         Intellectual Property license rights granted to it by the Terminating
         Party under this Agreement pursuant to section 11 hereof, and

         (b)  to the extent necessary for the Terminating Party to exercise its
         rights to make, use and sell Jericho Products under this Agreement, the
         Terminating Party shall be entitled to:

              (i)  full immunity from suit (i.e., a non-assertion covenant,
                   which is fully transferable to the Terminating Party's
                   Affiliates as well as the Terminating Party's suppliers,
                   vendors, and distributors of Jericho Products) for use of the
                   Terminated Party's Background IP, Derivative IP and solely
                   owned Foreground IP by the Terminating Party and its
                   customers within the Jericho Field of Use;

              (ii) access to the Terminated Party's Jericho Know How;

         (c)  if the Material Breach or Insolvency Event occurs after the first
         go/no go checkpoint, the Parties shall continue to pay each other the
         Jericho Product margin share set forth in section 10.

         (d)  if the Material Breach is by Indigo, Indigo shall continue to
         supply Consumables to HP under the relevant margin sharing terms set
         forth in section 10.

         12.4.2  Termination for Change of Control. If either Party terminates
         this Agreement due to a Change of Control of the other Party pursuant
         to section 12.3.1 (iii) above, the Terminating Party shall have the
         right to revoke the other Party's license to the Terminating Party's
         Background IP, Derivative IP and solely owned Foreground IP granted
         pursuant to section 11 above. Notwithstanding any such revocation, the
         Terminated Party shall have the right to continue to use said IP in the
         manufacture and sale of Jericho Products being manufactured at the date
         of such termination for a period of 12 months from the date of the
         termination, provided that (a) the branding on all such Jericho
         Products sold shall be the same as the branding used by the Terminated
         Party on those Jericho Products before the termination; (b) the
         Terminated Party shall not sell more of such Jericho Products during
         such 12 month period than 1.5 times the quantity sold during the 12
         month period preceding the termination; and (c) delivery of all such
         Jericho Products shall take place during the 15 month period following
         termination. For the sake of clarity, the rights to Intellectual
         Property granted to said Terminating Party


                                       16
<PAGE>
         pursuant to section 11 shall be subject to the Terminating Party's
         continued payment to the other Party of the margin share set forth in
         section 10.

         12.4.3  Termination by HP at Go/No Go Checkpoints. If HP chooses to
         terminate the Agreement at:

         (a)  the first of the two go/no go checkpoints pursuant to section
         12.3.1 (iv) above, HP shall lose all Intellectual Property rights
         granted to it by Indigo under section 11 of this Agreement as well as
         the rights to share in Indigo revenues pursuant to section 10; or

         (b)  the second of the two go/no go checkpoints pursuant to section
         12.3.1 (iv) above, HP shall lose all Intellectual Property rights
         granted to it by Indigo under section 11 of this Agreement but
         (provided it has made all payments pursuant to section 5.4) shall not
         lose the rights to share in Indigo revenues pursuant to section 10.

         12.4.4  Termination at end of Term. Upon any expiry pursuant to section
         12.2, all Intellectual Property license rights granted under section 11
         shall terminate. However, any Party shall have the right, by written
         notice to the other within 30 days of said expiry, to be granted, with
         respect to any Intellectual Property existing on said expiry date, an
         extension of such license rights for an additional period of up to 20
         years, subject to the notifying Party's continued payment to the other
         Party of the Jericho Product margin share set forth in section 10.

         12.4.5  Each Party shall ensure that the provisions of this section 12
         are binding on its successors and permitted transferees and assigns.

12.5     Survival. Sections 10, 11, 12.4, 12.5, 13, 14, 15, 16, 17 and 18 shall
survive termination of this Agreement, subject to any express provision to the
contrary set forth in this section 12.

13.      COMPETITION

Nothing herein should be interpreted to constrain either HP or Indigo from
researching, developing, manufacturing or selling any printing device or
consumable that may compete with Jericho Products, so long as such products do
not employ the other Party's Intellectual Property, including, but not limited
to, Intellectual Property embodied in the Indigo Core Technology.

14.      GENERAL REPRESENTATIONS AND WARRANTIES OF THE PARTIES


                                       17
<PAGE>
Indigo hereby makes, for the purposes of this Agreement and for the benefit of
HP, the representations and warranties set forth in sections 3.1, 3.3, 3.5, and
3.17 (to the extent applicable to the Indigo Core Technology) of the Stock
Purchase Agreement, and those representations and warranties are hereby
incorporated by reference into this Agreement. In addition, each Party hereby
represents and warrants:

14.1     it is a corporation duly organized, validly existing and in good
standing under the laws of the jurisdiction of its organization;

14.2     the execution, delivery and performance of this Agreement have been
duly authorized by such Party;

14.3     it has all requisite authority and ability to enter into and perform
under this Agreement, including granting the licenses granted hereunder; and

14.4     its performance under this Agreement will not materially violate any
agreement with or obligation to, or require the consent of, any third party.

15.      LIABILITY

15.1     Limitation of Liability. IN NO EVENT SHALL EITHER PARTY BE LIABLE TO
THE OTHER FOR ANY SPECIAL, CONSEQUENTIAL, INCIDENTAL, EXEMPLARY, OR INDIRECT
DAMAGES (INCLUDING, WITHOUT LIMITATION, LOST PROFITS, LOSS OF ANTICIPATED
BUSINESS, LOSS OF DATA OR BUSINESS LOSSES), ARISING DIRECTLY OR INDIRECTLY OUT
OF THIS AGREEMENT, HOWEVER CAUSED AND BASED UPON ANY THEORY OF LIABILITY, AND
WHETHER OR NOT SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
FURTHER, IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER FOR ANY CLAIM OF
DIRECT DAMAGES ARISING OUT OF THIS AGREEMENT IN AN AGGREGATE AMOUNT IN EXCESS OF
$1,000,000 PER CLAIM, OTHER THAN IN RELATION TO CLAIMS BY A PARTY ARISING UNDER
SECTION 11.4 OR CLAIMS ARISING AS A RESULT OF A BREACH OF CONFIDENTIALITY IN
CONTRAVENTION OF SECTION 17.1, IN RELATION TO WHICH LIABILITY SHALL BE
UNLIMITED.

16.      INDEMNITY

16.1     Indemnification

Subject to section 16.2, each Party ("INDEMNIFYING PARTY") shall defend,
indemnify, and hold harmless the other Party and its officers, directors,
agents, and representatives (each an "INDEMNIFIED PARTY") from and against, and
will solely and


                                       18
<PAGE>
exclusively bear and pay, any and all claims, suits, losses, penalties, damages,
and all liabilities ("CLAIMS") and the associated costs and expenses (including
attorneys' fees, experts' fees, and costs of investigation), arising directly or
indirectly from (i) a breach of any representation, warranty, covenant, term, or
provision of this Agreement by the Indemnifying Party; (ii) any negligent,
grossly negligent, or intentional acts, errors, or omissions by the Indemnifying
Party or its employees, officers, agents, or representatives in the performance
of this Agreement (iii) a product liability claim asserted against a Party by
any Person in respect of any Jericho Product (or component thereof) manufactured
by the other Party under any theory of liability.

16.2     Procedure.

The Indemnified Party shall promptly notify the Indemnifying Party of any Claim.
No failure of an Indemnified Party to so notify the Indemnifying Party shall
relieve the Indemnifying Party from the obligation to indemnify the Indemnified
Party unless and to the extent the Indemnifying Party is actually prejudiced by
such failure. The Indemnifying Party shall have control of the defense,
litigation and, subject to the conditions set forth below, settlement of any
Claims. The Indemnified Party shall have the right, but not the obligation, to
select counsel of their choice, at their expense, to participate in the defense
of any Claim provided however that the Indemnifying Party shall not accept a
settlement of any Claim without the prior written consent of the Indemnified
Party, which consent shall not be unreasonably withheld.

17.      GENERAL

17.1     Confidentiality.

         17.1.1  Definition of Confidential Information. "Confidential
         Information" means all information disclosed by a Party ("Disclosing
         Party") to the other Party ("Receiving Party") pursuant to, or in
         connection with, this Agreement, including any information disclosed in
         contemplation of this Agreement prior to the Effective Date, regardless
         of the form or manner of disclosure. "Confidential Information" shall
         not include information: (a) of which the Receiving Party was
         rightfully in possession prior to disclosure, as evidenced by
         appropriate documentation; (b) that was independently developed by
         employees or agents of the Receiving Party who have not received any
         Confidential Information provided by the Disclosing Party; (c) that the
         Receiving Party rightfully receives from a third party not owing a duty
         of confidentiality to the Disclosing Party; (d) that is or becomes
         publicly available without fault of the Receiving Party; (e) that is
         published incident to


                                       19
<PAGE>
         patent application prosecution; or (f) that the Parties agree in
         writing will not be treated as Confidential Information.
         Notwithstanding sub-section (e), neither Party shall include
         Confidential Information of the other Party in any patent application
         without the prior written consent of the other Party, such consent not
         to be unreasonably withheld.

         17.1.2  Identification as Confidential. Information of the Disclosing
         Party shall be deemed Confidential Information if (i) disclosed in
         writing, the information is marked by an appropriate legend, such as
         "HP Confidential" or "Indigo Confidential," or (ii) disclosed orally or
         visually, the information is designated (orally or in writing)
         contemporaneously or promptly thereafter, as "HP Confidential" or
         "Indigo Confidential," or (iii) the disclosure in any form (visually,
         orally, or in writing), by its very nature would reasonably be
         understood to be confidential.

         17.1.3  Confidentiality Obligations. The Receiving Party shall hold the
         Confidential Information of the Disclosing Party in confidence, using
         such measures as the Receiving Party uses to protect the
         confidentiality of its own confidential information of like importance,
         but in no event using less than reasonable care. The Receiving Party
         shall not make any disclosure of such Confidential Information other
         than to its employees and consultants on a need-to-know basis. The
         Receiving Party shall inform each such employee and consultant of the
         Receiving Party's confidentiality obligations under this Agreement and
         will require each such person to sign an appropriate nondisclosure
         agreement. The Receiving Party shall be liable for any breach of this
         section 17.1.3 by any of its employees or consultants acting within the
         scope of their authority. The Receiving Party shall use the Disclosing
         Party's Confidential Information solely to perform the activities
         contemplated by this Agreement and for no other purpose. The Receiving
         Party shall return the Disclosing Party's tangible Confidential
         Information to the Disclosing Party promptly upon the Disclosing
         Party's request or termination of this Agreement, whichever occurs
         first, unless the Receiving Party has a continuing right under this
         Agreement to use such Confidential Information. Nothing herein shall
         prevent assignment of the Parties' employees or consultants to other
         projects.

         17.1.4  Exceptions. Notwithstanding anything to the contrary in section
         17.1.3, disclosure of Confidential Information shall be permitted to
         the extent required by order of a court or governmental authority,
         provided that the Disclosing Party has been given timely notice of such
         requirement and that the Receiving Party must cooperate with the
         Disclosing Party to limit the scope and effect of such order.


                                       20
<PAGE>
         17.1.5  Residual Information. Access to Confidential Information
         hereunder shall not preclude an individual who has seen or been exposed
         to such Confidential Information for the purposes of this Agreement
         from working on future projects for the Receiving Party which are not
         prohibited hereunder and which relate to similar subject matters,
         provided that such individual does not make reference to any document
         or other tangible media containing the Confidential Information.
         Furthermore, nothing contained herein shall be construed as imposing
         any restriction on the Receiving Party's disclosure or use of any
         general learning, skills, or know-how developed by the Receiving
         Party's personnel under this Agreement, if such disclosure and use
         would be regarded by a person of ordinary skill in the relevant area as
         not constituting a disclosure or use of the Confidential Information.

         17.1.6  Injunctive Relief. Each Party acknowledges and agrees that the
         other Party would suffer irreparable harm for which monetary damages
         would be an inadequate remedy if there were a breach of obligations
         under this section 17.1. Each Party further acknowledges and agrees
         that equitable relief, including injunctive relief, would be
         appropriate to protect the other Party's rights and interests if such a
         breach were to arise, were threatened, or were asserted.

17.2     Publicity. So long as this Agreement is in effect, no Party or any of
its Affiliates shall issue or cause the publication of any press release or
other announcement with respect to the terms or implementation of this Agreement
without the prior consultation and approval of the other Party, except as my be
required by law; provided that such approval shall not be unreasonably withheld.
Any such publicity made in accordance with the terms of a joint communications
program shall not require approval under this section 17.2.

17.3     Assignment. Neither Party may assign any of its rights and/or
obligations hereunder (except to an Affiliate), whether by operation of law or
otherwise, without the prior written consent of the other Party, which consent
shall not be unreasonably withheld. Any assignment made in contravention of this
section 17.3 shall be void. This Agreement shall inure to the benefit of and be
binding upon the Parties and their respective administrators, permitted
successors and permitted assigns.

17.4     Notices. Any notice, request, consent, approval, or communication
(collectively a "Notice") under this Agreement shall be effective only if it is
in writing and (i) personally delivered, (ii) sent by certified or registered
mail, return receipt requested, postage prepaid (iii) sent by a nationally
recognized overnight delivery service, with delivery confirmed, or (iv) sent by
facsimile, with receipt confirmed, addressed as follows:


                                       21
<PAGE>
         (a)  if to HP, to

               HP
               Address:

               11311 Chinden Boulevard MS 310
               Boise, ID 83714
               Attention:  Neal Martini
               Telephone:  (208) 396-7808
               Facsimile:  (208) 396-7686

              with a copy to:

               Address:
               3000 Hanover Street, MS20-BT
               Palo Alto, CA 94304
               Attention:  Corporate Development Portfolio Manager
               Telephone:  (650) 857-3100
               Facsimile:  (650) 852-8342

              and to

               Skadden, Arps, Slate, Meagher & Flom
               Address:
               525 University Avenue, Suite 220
               Palo Alto, CA 94306
               Attention:  Kenton J. King
               Telephone:  (650) 470-4500
               Facsimile:  (650) 470-4570

         (b)  if to Indigo, to

               Indigo
               Address:
               _______________________
               _______________________

               Attention:  ________________
               Telephone:  ________________
               Facsimile:  ________________
               Email:      ________________

              with a copy to:

               Chadbourne & Parke LLP
               Address:
               30 Rockefeller Plaza


                                       22
<PAGE>
               New York, NY 10112
               Attention:  Dennis J. Friedman
               Telephone:  (212) 408-5200
               Facsimile:  (212) 489-5303

or such other persons or addresses as shall be furnished by Notice by a Party to
the other Party. A Notice shall be deemed to have been given as of the date when
(i) personally delivered, (ii) ten (10) days after properly addressed and mailed
as aforesaid, (iii) the next day when delivered during business hours to said
overnight delivery service properly addressed, or (iv) when receipt of the
facsimile is confirmed, as the case may be, unless the sending Party has actual
knowledge that a Notice was not received by the intended recipient. All Notices
shall specifically state: (i) the provision or provisions, if any, of this
Agreement with respect to which such Notice is given; and (ii) the relevant time
period, if any, in which the Party given such Notice must respond.

17.5     Amendments. The terms and provisions of this Agreement may not be
modified or amended without the written consent of each Party.

17.6     Severability. Every provision of this Agreement is intended to be
severable. If any term or provision hereof is held by a court of competent
jurisdiction or regulatory authority to be illegal or invalid for any reason
whatsoever, the Parties agree to negotiate in good faith a next best alternative
term or provision, as the case may be, that retains the parties' original intent
to the greatest extent possible. If the Parties are unable to negotiate such
term or provision, the original term or provision shall be enforced to the
maximum extent permitted by law, and, in any event, such illegality or
invalidity shall not affect the validity of the remainder of the Agreement, or
the validity of such item or provision in other jurisdictions.

17.7     Non-Waiver. No provision of this Agreement shall be deemed to have been
waived except if the giving of such waiver is contained in a written Notice
given to the Party claiming such waiver and no such waiver shall be deemed to be
a waiver of any other or further obligation or liability of the Party in whose
favor the waiver was given.

17.8     No Partnership. Nothing contained in this Agreement shall be deemed or
construed to make the Parties partners or joint venturers with each other.

17.9     Third-Party Beneficiaries. This Agreement is intended to benefit the
Parties and their respective permitted successors and permitted assigns and
shall not confer upon any other Person any rights or remedies.


                                       23
<PAGE>
17.10    Entirety of Agreement; Relation to Related Agreements. In connection
with this Agreement, it is contemplated that the OEM Agreement and the Stock
Purchase Agreement (collectively "RELATED AGREEMENTS") shall be executed. This
Agreement, together with the Related Agreements, constitutes the entire
agreement between the Parties with respect to the subject matter hereof, and
supersedes all prior drafts of the Agreement and all other agreements between
the Parties, express or implied, written or oral, including specifically but not
limited to the Strategic Affiliation Agreement referred to in the recitals and
all Confidentiality Agreements between the Parties prior to the Effective Date.

17.11    Construction. As used in this Agreement, all terms used in the singular
will be deemed to include the plural, and vice versa, as the context may
require. The words "hereof," "herein," and "hereunder" refer to this Agreement
as a whole, including the attached exhibits, as the same may from time to time
be amended or supplemented, and not to any subdivision in this Agreement. When
used in this Agreement, "including" means "including, without limitation".
Unless otherwise expressly stated, when a Party's approval or consent is
required under this Agreement, such Party may grant or withhold its approval or
consent in its discretion. References to "section" or "Exhibit" shall be to the
applicable section or exhibit of this Agreement. This Agreement has been
negotiated by the Parties and reviewed by their respective counsel and shall be
fairly interpreted in accordance with its terms and without any strict
construction in favor of or against either Party.

17.12    Headings. The headings of the sections of this Agreement are inserted
for convenience only and shall not be deemed to constitute a part hereof.

17.13    Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be considered an original.

18.      DISPUTE RESOLUTION

18.1     Applicable Law. This Agreement and the rights and obligations of the
Parties shall be interpreted and enforced in accordance with and governed by the
laws of the State of New York applicable to agreements made and to be performed
wholly within that jurisdiction and without reference to New York's conflict of
law rules.

18.2     Enforcement; Venue. The parties agree that irreparable damage would
occur in the event that any of the provisions of this Agreement were not
performed in accordance with their specific terms or were otherwise breached. It
is accordingly agreed that the parties shall be entitled to an injunction or
injunctions to prevent breaches of this Agreement and to enforce specifically
the terms and provisions of this Agreement, and to pursue any other remedy to
which they are entitled at law or


                                       24
<PAGE>
in equity, in any court of the United States located in the Southern District of
New York or, in the event that such Federal Court determines that it does not
have subject matter jurisdiction, in a New York State Court sitting in New York
County. In addition, in the event that any dispute arises from this Agreement,
each of the parties hereto (a) consents to submit itself to the personal
jurisdiction of such Federal or State Court, and neither Party shall object to
the laying of venue in such Federal or State Court, or contend that such forum
is an inconvenient forum; (b) agrees that it shall not attempt to deny or defeat
such personal jurisdiction by motion or other request for leave from any such
court and (c) agrees that it shall not bring any action relating to this
Agreement in any court other than as aforesaid.

18.3     Waiver of Trial by Jury. Each Party waives, to the fullest extent
permitted by applicable law, any right it may have to a trial by jury in respect
to any dispute or claim arising out of or relating to this Agreement.

18.4     Alternative Dispute Resolution ("ADR") for Certain Matters

         18.4.1  Disputes subject to ADR. Any dispute or claim arising out of or
         relating to (i) technical matters relating to the development of
         Jericho Products; (ii) interpretation of a statement of work; or (iii)
         asserted breaches of this Agreement that are not substantial and
         material ("DISPUTE") shall be resolved under the dispute resolution
         mechanism set forth in this section 18.4. Other disputes or claim
         arising from or relating to this Agreement (including without
         limitation matters involving Intellectual Property rights) shall not
         constitute a Dispute subject to ADR.

         18.4.2  Negotiations Between Project Managers. The Parties' respective
         project managers shall attempt in good faith to resolve a Dispute
         promptly once either Party has provided the other Party with Notice of
         such Dispute setting out reasonable details of the Dispute ("DISPUTE
         NOTICE"). The product managers shall meet and attempt to resolve the
         Dispute within seven days after the Dispute Notice at a mutually agreed
         upon time and place (either in person or by telephone). If the product
         managers are unable to resolve the Dispute fully within thirty (30)
         days of the Dispute Notice, the Parties agree to attempt in good faith
         to resolve the Dispute in accordance with the terms of section 18.4.3
         hereto.

         18.4.3  Negotiations Between Senior Executives. If the product managers
         are unable to resolve a Dispute pursuant to section 18.4.2, the Dispute
         shall be referred to senior executives of each of the Parties. The
         senior executives shall meet and attempt to resolve the Dispute by not
         later than 42 days after the Dispute Notice at a mutually agreed upon
         time and place (either in person or by telephone). If the senior
         executives are unable to resolve the Dispute


                                       25
<PAGE>
         fully by not later than 49 days after the Dispute Notice, the Parties
         agree to attempt in good faith to resolve the Dispute in accordance
         with the specific terms of section 18.4.4.

         18.4.4  Non-Binding Mediation. If the senior executives are unable to
         resolve a Dispute in accordance with section 18.4.4, either Party may
         submit the Dispute to non-binding mediation by Notice to the other
         Party ("MEDIATION NOTICE"), after which time either Party may request
         the President of the New York City Bar Association to appoint an expert
         mediator to assist with the mediation. If the Parties are unable to
         resolve the Dispute by non-binding mediation within thirty (30) days of
         the Mediation Notice, and the Dispute involves or relates to an
         interpretation of a statement of work (referred to in section 18.4.1),
         the Parties agree to resolve the Dispute in accordance with the
         specific terms of section 18.4.5. Otherwise, if the Parties are unable
         to resolve the Dispute fully through non-binding mediation, either
         Party shall be entitled to pursue litigation.

18.4.5   Arbitration.

              18.4.5.1 In the case where the Parties are unable to resolve a
              Dispute involving or relating to an interpretation of the
              statement of work through non-binding mediation in accordance with
              section 18.4.4, the Parties agree to submit the Dispute
              immediately for binding arbitration by notice of written demand
              for arbitration to the other Party, with a copy to the American
              Arbitration Association ("AAA") in New York. The arbitration shall
              be administered by the AAA in New York in accordance with the
              Federal Arbitration Act, 9 U.S.C. (1995) ("FAA") and pursuant to
              the AAA's rules for commercial arbitration, provided that such
              rules do not conflict with the FAA or the expressed intentions of
              the Parties in this Agreement. In the case of any such conflict,
              the FAA and/or the expressed intentions of the Parties shall
              prevail over the AAA's rules.

              18.4.5.2 There shall be three arbitrators. Each Party shall select
              an arbitrator, and the third arbitrator shall be selected by the
              AAA. Such third arbitrator shall be an attorney with expertise in
              commercial law, and he or she shall serve as chairperson of the
              arbitral panel. Each of the arbitrators selected by the Parties
              shall be knowledgeable with respect to subject matter at issue,
              which may include digital printing design, manufacture, and
              supply.

              18.4.5.3 The arbitration shall be conducted in New York City, New
              York.


                                       26
<PAGE>
              18.4.5.4 The Parties shall be responsible for their own costs of
              arbitration, including the fees of the arbitrators, regardless of
              the outcome of the arbitration.

              18.4.5.5 The Parties agree that, in order to minimize expense and
              time delays, discovery for the arbitration shall be kept to a
              minimum, with the arbitrators determining the extent thereof.

              18.4.5.6 The arbitrators shall issue a statement as to their
              decision, but shall not issue any written opinion in connection
              with any Dispute.

              18.4.5.7 The power and authority of the arbitrators to award
              relief in connection with any Dispute shall be restricted by the
              terms of section 15.1 of this Agreement. The Parties expressly
              agree to the enforceability of such restrictions, whether or not
              recognized by the law of the State of New York or the FAA. In no
              circumstances shall the arbitrators have the power or authority to
              award equitable, provisional or injunctive relief and the parties
              expressly agree that it shall be an abuse of the arbitrators'
              discretion to award such relief.




                                       27
<PAGE>
IN WITNESS WHEREOF, the parties have signed this Agreement, through their duly
authorized representatives, on the date first set forth hereinabove.

INDIGO N.V.                            HEWLETT-PACKARD COMPANY


Signed by:   /s/ Benzion Landa         Signed by:
          ------------------------               -------------------------------

Name:   Benzion Landa                  Name:
     -----------------------------          ------------------------------------

Title:  Chairman and CEO               Title:
      ----------------------------           -----------------------------------







                                       28
<PAGE>
IN WITNESS WHEREOF, the parties have signed this Agreement, through their duly
authorized representatives, on the date first set forth hereinabove.

INDIGO N.V.                            HEWLETT-PACKARD COMPANY


Signed by:                             Signed by:    /s/ Neal Martini
          ------------------------               -------------------------------

Name:                                  Name:         Neal Martini
     -----------------------------          ------------------------------------

Title:                                 Title:        VP, GM
      ----------------------------           -----------------------------------
                                                LaserJet Business Printing



                                       29