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Seismic data is used to visualize the Earth's sub surface. This is achieved by measuring travel times of reflections from pressure waves propagating through the ground. Seismic data and interpretations of seismic data will therefore often have z values in travel time, not depth. In order to get a depth value for a travel time value, we need to do a depth conversion. A depth conversion combines the velocity of the pressure wave with the travel time to get a depth value. 

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A velocity model is stored as an item in your Project. I It represents the seismic velocities in an area, and is used as input to the  "Velocity Model Depth Convert" command. In order to create a velocity model, set a "Velocity models" schema on a generic folder, and run the command "Generate Velocity model". In order to see or edit the parameters of a velocity model, right click the velocity model  item in the project and select "View/Edit". 

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