ERwin XML generated by version 7.3.8 sample model can’t be imported in to VP and it’s stopping at the middle of the process.
I just tested ERwin XML import with your sample model and it do works without any issue. It imported 436 ERDs. Since your XML is pretty large (264MB) it do require more memory to complete the import. Would you please go to Help > About > Utilities to set the application with higher memory (i.e. 4GB), then restart the application and see is the import works? Look forward to hearing from you.