The recommended solution is to upgrade your HylaFAX server to version 4.2.0 or later.

For more information and a possible workaround see below:

HylaFSP generates fax-optimised 2D-MMR tiff files for maximum compression. HylaFAX may need to convert the TIFF to MR or MH format if your modems (or the receiving fax machines) do not support 2DMMR.

The exit status 9 error you see during the conversion process is due to a known bug in libtiff that can occur when trying to carry out this conversion. See: http://www.hylafax.org/archive/2003-02/msg00181.html

You can either downgrade to libtiff-3.5.5, upgrade to libtiff-3.6.x (nor presently recommended because of MMR problems with libtiff), or apply the following patch to your current HylaFAX version:
http://bugs.hylafax.org/bugzilla/show_bug.cgi?id=341

By far the best solution though is to upgrade to the latest release of HylaFAX which includes this patch already.