Document:

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                                                                    EXHIBIT 10.9

                            PATENT LICENSE AGREEMENT

         This Agreement made and entered into this 16 day of May, 1998, by and
between VTV, Incorporated, ("VTV") a Colorado Corporation, 1700 Broadway, Suite
1800, Denver, CO 80290, and Energy Partners, Ltd., ("EPL") a Delaware
corporation, having a principal place of business at 1100 Poydras, Suite 1850,
New Orleans, LA 70163.

                                    ARTICLE I

                                     GENERAL

         1.01 VTV and EPL are hereafter occasionally referred to as the
"parties" (in singular or plural usage, as indicated by the context).

         1.02 VTV owns an exclusive license in and to the D3DSP (Diagnostic
Three Dimensional Seismic Process) U.S. Patent No. 5671136, (the "Patent")
granted to VTV by the inventor, Louis E. Willhoit, Jr. ("Willhoit"), pursuant to
the License Agreement attached hereto as Exhibit "A."

         1.03 VTV represents that it is authorized and prepared in respect to
its exclusive license in and to the United States patent named in Section 1.02
above, to grant to any financially responsible applicant a nonexclusive
sub-license.

         1.04 EPL is desirous of obtaining a nonexclusive license from VTV for
use of the D3DSP in certain of its activities relating to the exploration for
and development/exploitation of oil and gas reserves.

                                   ARTICLE II

                                  LICENSE GRANT

         2.01 VTV grants to EPL a nonexclusive license to utilize the D3DSP in
EPL's oil and gas activities. EPL may not transfer, grant, convey, sell, or
assign to, or otherwise authorize the use of the D3DSP by, any other person,
firm or corporation, except as set forth in Section 5.01.

         2.02 The term of the license granted hereby shall be perpetual.

         2.03 EPL shall not own any right in or to the D3DSP, U.S. Patent No.
5671136, or any trade secret or other intellectual property right relating
thereto, by reason of this Agreement or otherwise. EPL shall have a shop right
to use any improvements to the D3DSP developed while Willhoit is an employee of
EPL.

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         2.04 Any version of any image produced by the use of the D3DSP pursuant
to this nonexclusive license shall bear the legend "copyright VTV, Inc."

         2.05 VTV shall have the right to publish without attribution any image
produced by EPL using the D3DSP subject to written approval by EPL, which shall
not be unreasonably withheld. VTV shall keep confidential any information
regarding EPL's business which is received as a result of this sub-license.

                                   ARTICLE III

                          ROYALTIES AND EFFECTIVE DATE

         3.01 EPL will pay to VTV for this nonexclusive license, the sum of one
dollar. This nonexclusive license agreement shall not become effective until
execution of the Employment Agreement between Willhoit and EPL.

         3.02 EPL will make written reports to VTV annually from the date of
this agreement stating in each such report the extent of the use of the D3DSP by
EPL. Such reports will be kept confidential by VTV.

         3.03 This agreement shall not become effective until execution of an
agreement in writing between Willhoit and VTV whereby Willhoit agrees to assign
and transfer to VTV all of his right, title and interest in and to any
unrestricted and freely-transferable common stock of EPL which Willhoit acquires
once any and all contractual, statutory and other legal restrictions applicable
to EPL common stock are no longer applicable.

                                   ARTICLE IV

                   REPRESENTATIONS AND WARRANTIES; LIMITATIONS

         4.01 Nothing in this agreement shall be construed as:

                  (a) A warranty or representation by either party as to the
                  validity or scope of any the Patent except as provided in
                  Section 4.03; or

                  (b) A warranty or representation that anything made by VTV,
                  used, sold, or otherwise disposed of under any license granted
                  in this agreement is or will be free of infringement of
                  patents of third persons; or

                  (c) A requirement that either party shall file any patent
                  application, secure any patent; or

                  (d) An obligation to bring or prosecute actions or suits
                  against third parties for infringement of any patent; or

<PAGE>   3

                  (e) An obligation to furnish any manufacturing or technical
                  information, or any information concerning pending patent
                  applications; or

                  (f) Conferring a right to use in advertising, publicity, or
                  otherwise any trademark or tradename of the party from which a
                  license is received under the agreement; or

                  (g) Granting by implication, estoppel, or otherwise, any
                  licenses or rights under patents other than the Patent.

         4.02 Neither party makes any representations, extends any warranties of
any kind, either express or implied, or assumes any responsibilities whatever
with respect to use, sale, or other disposition by the other party of products
incorporating or made by use of inventions licensed under this agreement.

         4.03 VTV represents and warrants that it is the exclusive licensee of
the D3DSP Patent and that the Patent is issued and is valid. VTV represents that
VTV is not aware of any alleged patent infringement and will notify EPL
immediately of any allegation of infringement.

         4.04 VTV indemnifies EPL from and against any claims for loss or damage
by The Louisiana Land and Exploration Company ("LL&E"), or its successor in
interest, Burlington Resources relating to that certain Agreement between VTV
and LL&E dated January 16, 1997. VTV indemnifies EPL from and against any and
all claims, damages, demands, and causes of action relating to any infringement
or alleged infringement of any patent or other intellectual property right
incurred or brought against EPL arising from this Agreement.

                                    ARTICLE V

                    TRANSFERABILITY OF RIGHTS AND OBLIGATIONS

         5.01 Any license or release granted in this agreement by a party in
respect to the Patent shall be binding upon and inure to the benefit of any
successor of the parties.

         5.02 The obligations of EPL to make reports, and maintain records as
provided herein in respect to any subsisting license under this agreement shall
run in favor of any person or legal entity which is a successor or assignee of
EPL in respect to EPL's benefits under the agreement. EPL shall not transfer or
assign its rights under this Agreement without the prior written consent of VTV,
which will not be unreasonably withheld, except as provided in Section 5.01.

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<PAGE>   4

         5.03 The license received by any party under this agreement shall pass
to any assigns for the benefit of creditors of the licensed party, and to any
receiver of its assets, or to any person or corporation succeeding to its entire
business in licensed products as a result of sale, consolidation,
reorganization, or otherwise, provided such assignee, receiver, person, or legal
entity shall, without delay, accept in writing the provisions of this agreement
and agree to become in all respects bound thereby in the place and stead of the
licensed party, but may not otherwise be transferred without the written consent
of the licensing party.

                                   ARTICLE VI

                              TERM AND TERMINATION

         6.01 VTV may terminate this agreement in the event of a default by EPL
in the due observance or performance of any covenant, condition, or limitation
of this License Agreement required to be performed by EPL.

                                   ARTICLE VII

                      NOTICES, APPLICABLE LAW; ARBITRATION

         7.01 Any notice, report, or payment provided for in this agreement
shall be deemed sufficiently given when sent by certified or registered mail
addressed to the party for whom intended at the address given at the outset of
this agreement or at such changed address as the party shall have specified by
written notice.

         7.02 This agreement shall be construed, interpreted, and applied in
accordance with the laws of the State of Colorado. The parties agree that the
courts of Colorado shall have jurisdiction over the parties and the subject
matter of any dispute that arises hereunder or otherwise.

         7.03 Any controversy or claim arising under or related to this contract
insofar as it involves or is limited to a question of infringement of any claim
or claims of the Patent shall be settled by arbitration in accordance with the
Patent Arbitration Rules of the American Arbitration Association before a single
arbitrator selected in accordance with those rules, and judgment upon the award
rendered by the arbitrator may be entered in any court having jurisdiction
thereof.

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                                  ARTICLE VIII

                                   INTEGRATION

         8.01 This instrument contains the entire and only agreement between the
parties and supersedes all preexisting agreements between them respecting its
subject matter. Any representation, promise, or condition in connection with
such subject matter which is not incorporated in this agreement shall not be
binding upon either party. No modification, renewal, extension, waiver, and
(except as provided in Article VI hereof) no termination of this agreement or
any of its provision shall be binding upon the party against whom enforcement of
such modification, renewal, extension, waiver or termination is sought, unless
made in writing and signed on behalf of such party by one of its executive
officers. As used herein, the word "termination" includes any and all means of
bringing to an end prior to its expiration by its own terms this agreement, or
any provision thereof, whether by release, discharge, abandonment, or otherwise.

         IN WITNESS WHEREOF, each of the parties has caused this agreement to be
executed and duly sealed in duplicate originals by its duly authorized
representative.

                                       VTV, INCORPORATED
                                       By
                                         /s/ JEFFREY J. SCOTT
                                       -----------------------------------------
                                       President
Attest:

                                       (SEAL)
----------------------------------
Secretary

                                       ENERGY PARTNERS, LTD.
                                       By
                                         /s/ RICHARD A. BACHMANN
                                       -----------------------------------------
                                       President
Attest:

  /s/ JEAN STALLARD                    (SEAL)
----------------------------------
Secretary

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                                                                    EXHIBIT A

                                EXCLUSIVE LICENSE
                               TO USE, DEVELOP AND
                         MARKET THE D3D SEISMIC PROCESS

         THIS EXCLUSIVE LICENSE (this "Agreement") is made and entered into this
29th day of August, 1996, by and between Louis E. Willhoit, Jr. (hereinafter
"Owner"), an individual, having an address for purposes of this Agreement at 30
Papworth Avenue, Metairie, Louisiana 70005 and VTV, Incorporated (hereinafter
"Developer"), a Colorado corporation, having an address for purposes of this
Agreement at 600 17th Street, Denver, Colorado 80202.

                                   WITNESSETH:

         WHEREAS, Owner is the sole owner of all the right, title and interest
in and to all U.S. patent applications, patents and copyrights and all other
intellectual property rights pertaining to the Diagnostic Three Dimensional
Seismic Process (the "Process") that are the subject of this Agreement;

         WHEREAS, Owner wishes (1) to provide to Developer detailed specific
written documentation pertaining to the application of the Process; (2) to grant
Developer the exclusive right and license to use and develop such documentation
for purposes of developing the Process for internal purposes (defined in Section
1 hereof in more specific detail as "Process" and "Process Documentation") and
developing the Process for integration in Products to be offered to End-Users
(defined in Section 1 hereof in more specific detail as "Product" and "Product
Documentation"); and (3) to grant Developer the exclusive right and license to
copy and use the Process and Process Documentation for productive internal
purposes, and the exclusive right and license to copy and distribute Products
and Product Documentation to its customers pursuant to a specific form of
Product License;

         WHEREAS, Developer wishes (1) to test and evaluate the Development
Process and Development Documentation to be delivered by Owner; (2) if the
results of such testing and evaluation are positive, to proceed with the further
development of the Process and

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Production Documentation; and (3) to market the Process and Process
Documentation, as integrated in Products; and

         WHEREAS, Owner is willing to grant Developer the rights and licenses
set forth in this Agreement, and Developer is willing to perform the other
obligations set forth in this Agreement, all pursuant to the terms and
conditions of this Agreement.

         NOW, THEREFORE, in consideration of the premises, as well as the
obligations herein made and undertaken, and one dollar and other good and
sufficient consideration had and received, the parties hereto, intending to be
legally bound, do hereby agree as follows:

                                    SECTION 1

                                   DEFINITIONS

         When used in this Agreement, the definitions set forth in this Article
shall apply to the respective capitalized terms:

         1.1 "AGREEMENT TERRITORY." The United States of America and the
territory of Puerto Rico and every other country of the world.

         1.2 "PROCESS." The Diagnostic Three Dimensional Seismic Process and
patent (U.S. Patent Application Number 08/570294) and all copyrights relating
thereto which is the subject of this Agreement and to which these definitions
apply.

                  a. "DEVELOPMENT PROCESS." Hardware, software, data and
interpretation techniques used in development of modifications toward marketable
Products.

                  b. "PRODUCT PROCESS." Hardware, software, data and
interpretation techniques incorporated into Product(s) marketed and offered by
Developer to End-Users under a Product License.

                                      -2-
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         1.3 "DERIVATIVE WORK." A work that is based upon one or more
preexisting works, such as a revision, modification, translation (including
compilation or recapitulation by computer), abridgement, condensation,
expansion, or any other form in which such a preexisting work may be recast,
transformed, or adapted, and that, if prepared without authorization by the
owner of the preexisitng work would constitute a copyright infringement.

         1.4 "PROCESS DOCUMENTATION." Printed material relating to the Process
and instructions for its use, as more fully described in the specifications
contained in Exhibit B, supplied herewith under separate cover, Documentation is
classified as Development Documentation and Production Documentation, as defined
herein below.

                  a. "DEVELOPMENT DOCUMENTATION." Printed material that relates
to source code, including comments, and that incudes a description of the
principles of operation of the Development Process and instructions for its use.
All copies of Development Documentation shall be numbered and marked by Owner
"Development Documentation--Property of Louis E. Willhoit, Jr. -- Do Not Copy"
and bear Owner's patent and copyright notice.

                  b. "PRODUCTION DOCUMENTATION." Those printed materials derived
from the Development Documentation necessary for operation and use of the
Process.

                  c. "PRODUCT DOCUMENTATION." Those printed materials, or parts
of printed materials, derived from the Production Documentation necessary for
End-Users to operate and use Products.

         1.5 "EFFECTIVE DATE." The date on which Developer secures financing as
agreed in the agreement between the parties dated July 17, 1996.

         1.6 "END-USER." A customer of Developer for the use of Products under
the terms and conditions of the Product License.

                                      -3-

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         1.7 "END-USER COPY." A copy of the Product Documentation that may be
used by End-User under the Product License. Backup copies permitted by the
Product License (for use only in the event of loss or destruction of an End-User
Copy) are not counted as additional End- User Copies.

         1.8 "ERROR." A defect in the Development Process or a mistake in the
Development Documentation that prevents the Process from functioning in
substantial conformance with the Specifications.

         1.9 "ERROR CORRECTION." A change to the Development Process or the
Development Documentation that is in a form that allows its application to the
Development Process or insertion in the Development Documentation to establish
substantial conformance with the Specifications. All Error Correction developed
by either Owner or Developer shall be considered part of the Development Process
and Development Documentation for all purposes under this Agreement.

         1.10 "MATERIAL BREACH." The filing of a bankruptcy petition by or on
behalf of Developer, or the failure of Owner or Developer substantially to
comply with the terms and conditions of this Agreement.

         1.11 "PRODUCTS." Hardware, software, data and interpretation techniques
developed, tested and verified by Developer that contain the Process and that
Developer decides to market to End-Users. Developer shall identify Products as
Developer's product and offer Products solely under the Product License.

         1.12 "PRODUCT LICENSE." A license agreement between Developer and
End-Users under which Products will be provided. Each Product License shall at a
minimum contain terms that:

                                      -4-
<PAGE>   10

                  a. Authorize the use of End-User Copies of the Product and
Product Documentation in offices designated in the Product License by name,
address, country and mailing (zip) code;

                  b. Authorize End-User to make one copy of each authorized
End-User Copy for backup purposes only;

                  c . Prohibit further copying and/or transfer of the Products
and Product Documentation by the End-User;

                  d. Limit the use of the Products to the provision of services
to the End-User's direct customers;

                  e. Prohibit the End-User or its customers who may have access
to the Products incident to services provided by the End-User, from reverse
engineering, reverse compilation, or reverse assembly of the Product; and

                  f. Include the following statements: "Product(s) provided
under this Agreement may contain or be derived from portions of the Process and
Documentation provided by Louis E. Willhoit, Jr. under license to Developer.
Developer has assumed responsibility for the development of the Process and
Process Documentation and its use in producing and licensing the Product(s).
LOUIS E. WILLHOIT, JR. DISCLAIMS ALL WARRANTIES WITH RESPECT TO THE USE OF THE
D3D SEISMIC PROCESS OR DOCUMENTATION IN THE PRODUCT(S), INCLUDING, WITHOUT
LIMITATION, ANY WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR
PURPOSE."

                                       -5-

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                                    SECTION 2

                               OWNER'S OBLIGATIONS

         2.1 DELIVERY OF DEVELOPMENT PROCESS DOCUMENTATION. Owner shall deliver
to Developer one complete copy of the Development Process Documentation within
ten (10) days following the Effective Date of this Agreement.

         2.2 SUPPORT SERVICES. Owner shall remain reasonably available to
provide support services on reasonable notice for the Development Process and
Development Documentation, in accordance with Section 9 of this Agreement during
the six (6) months following the delivery of the Development Process and
Development Documentation.

         2.3 NO ASSIGNMENT. Owner shall not sell, assign, transfer, license,
encumber or otherwise grant in any form any rights to use, operate or employ the
Process to any other person, firm, corporation or governmental agency during the
term of this Agreement.

                                    SECTION 3

                             DEVELOPER'S OBLIGATIONS

         3.1 EVALUATION AND TESTING. Developer shall evaluate and test the
Development Process and Development Documentation and shall determine whether
the Development Process and Development Documentation are suitable for use as
Production Process and for use in the creation of Products. Such evaluation
shall be completed within thirty (30) days of delivery of the Development
Process and Development Documentation to the Developer.

         3.2 MARKETING OF PRODUCTS. If Developer does not terminate this
Agreement pursuant to Section 8.1 upon completion of testing and evaluation, and
upon completion of the arrangement of financing of operations of Developer,
Developer shall use its best efforts to manufacture, market and distribute
Products on commercially reasonable terms to potential End- Users under a
Product License within the Agreement Territory.

         3.3 RESPONSIBILITIES. Developer shall and hereby assumes all
responsibility for the following:

                                      -6-
<PAGE>   12

                  a. The development of the Process to achieve Developer's
intended purposes;

                  b. The development of the Production Process and Production
Documentation, and the further development of the Product Process and Product
Documentation and the integration thereof into Products;

                  c. The use of the Process and Process Documentation pursuant
to this Agreement;

                  d. The results obtained therefrom;

                  e. Testing and determining the adequacy and marketability of
Products;

                  f. Liability to End-Users for any authorized or unauthorized
use of Products by Developer; and

                  g. Protection of Owner's rights in accordance with Section 6
of this Agreement.

         3.4 ROYALTIES AND PAYMENTS. Developer shall pay royalties to Owner and
provide related information and access to records in accordance with Section 4
of this Agreement.

         3.5 GRANT OF EXCLUSIVE LICENSE. Owner hereby grants to Developer, in
the Agreement Territory, the following exclusive rights and licenses.

                  a. The exclusive right and license to use the Process and to
use, test, evaluate, and prepare Derivative Works of the Development Process on
one development system operated by the Developer.

                                      -7-
<PAGE>   13

                  b. The exclusive right and license to prepare the Process and
Process Documentation, as Derivative Works of the Development Process and
Development Documentation; to copy, merge, or incorporate the Process into other
computer programs in connection with the design, development and manufacture of
Products; and to display, sell, license or otherwise transfer or distribute
copies of the Process for use in and as part of Product(s) solely to End-Users
and solely pursuant to a Product License.

                  c. The right to make and use a reasonable number of copies of
the Process Documentation, including Derivative Works thereof, for purposes of
marketing, training and demonstrations related to the Products; provided,
however, that such copies are marked "Marketing, Training and Demonstration Use
Only."

                  d. Except for parts of the Development Documentation
necessarily used in Process Documentation, no right or license to make any
copies of the Development Documentation is granted or implied.

                                    SECTION 4

                             ROYALTIES AND PAYMENTS

         4.1 No royalty will be paid to Owner as long as both this Agreement and
the Agreement between the parties dated July 17, 1996 remain in effect.

                                    SECTION 5

                            CONFIDENTIAL INFORMATION

         5.1 DEVELOPMENT PROCESS AND DEVELOPMENT DOCUMENTATION. Developer agrees
that the Development Process and Development Documentation contain confidential
information of Owner, and embody trade secrets developed by Owner at substantial
cost and expense. Developer shall hold Development Process and Development
Documentation in

                                      -8-
<PAGE>   14

confidence for Owner, except as provided herein. Developer shall employ
reasonable secrecy precautions, at least as protective as the precautions it
uses to protect its own proprietary computer programs, to protect the
Development Process and Development Documentation from unauthorized copying, use
or disclosure. Developer shall allow access to the Development Process and
Development Documentation only to employees and contractors of Developer who are
performing services for Developer related to the purposes of the Agreement, who
have a need to know information contained in the Development Process and
Development Documentation, and upon whom Developer has used its best efforts to
impose a legal duty to protect the Development Process and Development
Documentation from unauthorized copying, use, or disclosure. Developer agrees to
use its best efforts to prevent, prosecute and enjoin any actual or threatened
unauthorized copying, use or disclosure of Development Process and Development
Documentation.

         5.2 CONTRACTS. Developer shall use its best efforts to prevent,
prosecute, and enjoin any unauthorized copying, distribution and reverse
engineering of the Process through appropriate restrictive contracts entered
into by its employees, consultants, and other third parties having access
thereto, and through the use of the Product License with End-Users, and shall
pursue appropriate actions to enforce such protection provisions.

                                    SECTION 6

                               MARKING OF PRODUCTS

         6.1 All Documentation and all Products, shall be marked with Owner's
patent, copyright and other proprietary notices. However, Developer may mark
with its own patent or copyright notice and register Derivative Works of the
Development Process or Development Documentation prepared by Developer that
constitutes original works of authorship, provided that this Development Process
and Development Document are identified in any such registration as preexisting
works of Owner. The parties agree to cooperate in all patent and copyright
registrations and to provide to each other information and documents required
for such registration.

                                      -9-
<PAGE>   15

                                    SECTION 7

                                TERM OF AGREEMENT

         7.1 The Base Term of this Agreement shall be the period beginning with
the Effective Date and continuing for a period of ten (10) years. The term of
this Agreement shall be the period beginning with the Effective Date and
continuing until all patents of the Process and copyrights in the Development
Process and Development Documentation have expired, unless sooner terminated
under Section 8 hereof. This Agreement may be extended by Developer for
successive terms of five (5) years each by giving written notice to Owner within
thirty (30) days prior to the termination date of any term of this Agreement.

                                    SECTION 8

                TERMINATION; EFFECT OF EXPIRATION OR TERMINATION

         8.1 NEGATIVE RESULTS OF TESTING. Developer may terminate this Agreement
within thirty (30) days of Owner's delivery of the Development Process and
Development Documentation if the result of the testing and evaluation pursuant
to Section 3.1 of this Agreement is negative. Developer shall provide to Owner
notice in writing of such decision to terminate, including a summary of the
reasons for such determination that the Development Process and Development
Documentation are not suitable for Developer's purposes. Upon such termination,
Developer shall return all copies of the Development Process and Development
Documentation to Owner and destroy all Derivative Works related thereto.

         8.2 BREACH. Should either party cause or commit a Material Breach of
any obligation hereunder, the other party may, at its option, terminate this
Agreement by sixty (60) days' written notice to the other party. Such notice
shall state the default upon which termination is based. Notwithstanding such
notice, termination shall not occur and the defaulting party shall not be liable
for any further remedy if such default is cured within such period.

                                      -10-
<PAGE>   16

         8.3 CONTINUED RIGHTS. Upon termination or expiration of the Base Term
of this Agreement, the rights and licenses herein granted shall terminate,
except for the right to continue to distribute Products that have been
completed, sold or licensed, and installed by at least one End-User prior to
such effective date. Upon termination or upon expiration of the Base Term,
Developer may retain the Development Process and Development Documentation and
shall have the continuing right of use solely for the purposes of supporting
such surviving Production Process, Production Documentation and Products.

         8.4 RETURN OF MATERIALS. Upon the termination of this Agreement,
Developer shall immediately deliver to Owner or destroy all copies of the
Process, Documentation, Products, Derivative Works of any and all of the
foregoing, and all sales literature produced pursuant to this Agreement.
Developer shall warrant in writing, upon request of Owner, that no copies of any
such material have been retained or are within the control of Developer. The
only exception to the foregoing shall be one archival copy of items deemed by
Developer to be necessary in enforcement of Developer's rights, which archival
copy shall be sealed and placed in the hands of a bonded, independent custodian
under a legally enforceable obligation of confidentiality and nonuse, for use
only be Developer in the assertion of rights and defenses by Developer.

                                    SECTION 9

                                 INDEMNIFICATION

         9.1 DEVELOPER INDEMNIFICATION. Developer indemnifies and holds harmless
Owner from any and all claims, demands, or actions based upon or relating to
Products or to services offered by Developer involving use of the Process, or
based on the performance or nonperformance of such services, or based upon
representations or statements made by Developer or its agents, or other actions
of Developer or its agents, with respect to any such Product or service, except
for claims, demands or actions caused by the reckless conduct or intentional
wrongdoing of Owner.

                                      -11-
<PAGE>   17

         9.2 CONDITIONS. The foregoing indemnity shall be contingent upon the
following conditions: Owner shall (1) give prompt written notice to Developer of
any claim, demand, or action for which indemnity is sought; (2) fully cooperate
in the defense or settlement of any such claim, demand or action; (3) obtain the
prior written agreement of the Developer to any settlement or proposal of
settlement regarding any claim, demand or action, which agreement shall not
unreasonably be withheld; and (4) be in compliance with all the terms and
provisions of this Agreement.

                                   SECTION 10

                                  MISCELLANEOUS

         10.1 NO ASSERTION OF RIGHTS. It is expressly understood and agreed
that, as between Owner and Developer, all right, title and interest in and to
the Development Process, Development Documentation (both as independent works
and as underlying works serving as a basis for any Derivative Works thereto) and
any other material furnished to Developer under this Agreement vests solely and
exclusively in Owner, and Developer shall neither derive nor assert any title or
interest in or to such items except for the rights and licenses granted under
this Agreement.

         10.2 INDEPENDENT CONTRACTOR STATUS. Developer is an independent
contractor under this Agreement, and nothing herein shall be construed to create
any partnership, joint venture, or agency relationship between the parties
hereto. Developer is granted no authority under this Agreement to enter into
agreements of any kind on behalf of Owner, or to bind or obligate Owner in any
manner to any third party.

         10.3 NO CONFLICT OF INTEREST. Developer represents and warrants that it
has full power and authority to undertake the obligations set forth in this
Agreement, and that it has not entered into any other agreement, nor will it
enter into any other agreement, that would render it incapable of satisfactorily
performing its obligations hereunder or that would place it in a position of
conflict of interest or be inconsistent with its obligations hereunder.

                                      -12-
<PAGE>   18

         10.4 COMPLIANCE WITH LAW. Developer agrees that it shall use its best
efforts to comply with all applicable laws and regulations of governmental
bodies or agencies in its performance under this Agreement.

         10.5 NO ASSIGNMENT. Developer represents that it is acting on its own
behalf and is not acting as an agent for or on behalf of any third party, and
further agrees that it may not assign its rights or obligations under this
Agreement without prior written consent of Owner.

         10.6 NOTICES. All notices and other communications required or
permitted to be given under this Agreement shall be in writing and shall be
considered effective when deposited in the U.S. Mail, postage prepaid, and
addressed to the appropriate party at the address noted above, unless by such
notice a different address shall have been designated in writing.

         10.7 GOVERNING LAW. All questions concerning the validity, operation,
interpretation and construction of this Agreement shall be governed by and
determined in accordance with the laws of the State of Colorado.

         10.8 NO WAIVER. Neither party shall, by mere lapse of time, without
giving notice or taking other action hereunder, be deemed to have waived any
breach by the other party of any of the provisions of this Agreement. Further,
the waiver by either party of a particular breach of this Agreement by the other
shall neither be construed as nor constitute a continuing waiver of such breach
or of other breaches of the same or any other provision of this Agreement.

         10.9 FORCE MAJEURE. Neither party shall be in default if failure to
perform any obligation hereunder is caused solely by supervening conditions
beyond that party's reasonable control, including acts of God, civil commotion,
strikes, labor disputes and governmental demands or requirements.

         10.10 SURVIVAL. The provisions of Section 5-6, 8.3-8.4, 9 and 10 of
this Agreement shall survive the expiration or termination of this Agreement.

                                      -13-
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         10.11 SCOPE OF AGREEMENT; AMENDMENT. The parties hereto acknowledge
that each has read this Agreement, understands it, and agrees to be bound by its
terms. The parties further agree that this Agreement is the complete and
exclusive statement of the Agreement between the parties and supersedes all
proposals (oral or written), understandings, representations, conditions,
warranties, covenants and all other communications between the parties relating
to the Process and Documentation. This Agreement may be amended only by a
subsequent writing that specifically refers to this Agreement and that is signed
by both parties, and no other act, document, usage or custom shall be deemed to
amend this Agreement.

         IN WITNESS THEREOF, the parties have caused this Agreement to be
executed by their respective duly authorized representatives as set forth below:

                                            OWNER:

Dated:      August 29         , 1996        /s/ Louis E. Willhoit, Jr.
        ---------------------               ------------------------------------
                                            Louis E. Willhoit, Jr.

                                            DEVELOPER:

                                            VTV, INCORPORATED

                                            By:

Dated:      August 27         , 1996        /s/ Jeffrey J. Scott
        ----------------------              ------------------------------------
                                            Jeffrey J. Scott, President
                                            ------------------------------------

                                      -14-<PAGE>   1
                                                                   EXHIBIT 10.38

                           ASSIGNMENT AND BILL OF SALE

THE STATE OF LOUISIANA

PARISH OF ORLEANS

                  This Assignment and Bill of Sale ("Assignment") is executed
and delivered by Hughes-Rawls, L.L.C., a Delaware limited liability company
("Assignor"), to Energy Partners, Ltd., a Delaware corporation ("Assignee").

                  Whereas, pursuant to the terms of the Farmout Agreement dated
as of August 15, 1998 (the "Farmout Agreement") among Assignor and Chevron
U.S.A. Inc., a Pennsylvania corporation, Assignor has the right to earn certain
interests as more fully set forth therein; and

                  Whereas, pursuant to the terms of the Exploration Agreement
and Agreement to Assign dated effective August 15, 1998 between Assignor and
Assignee (the "Exploration Agreement"), Assignor agreed to assign a 30%
undivided interest in the Farmout Agreement to Assignee; and

                  Now, therefore, Assignor, for valuable considerations, the
receipt and sufficiency of which are hereby acknowledged, does by these presents
assign and transfer unto Assignee an undivided thirty percent (30%) interest
(the "30% Interest") in and to the Farmout Agreement.

                  TO HOLD such 30% Interest in the Farmout Agreement, together
with all rights, titles, interests, remedies, powers and privileges thereunto
appertaining unto Assignee and its successors, legal representatives and assigns
forever, subject to the terms and provisions of the Farmout Agreement. Assignor
(i) warrants that it is the valid holder of the Farmout Agreement and that the
30% Interest is free from all liens or encumbrances created by Assignor or
transfer restrictions that are unsatisfied, and (ii) hereby binds itself, its
successors, legal representatives and assigns, to defend such warranty unto
Assignee, its successors, legal representatives and assigns, against every
person whomsoever claiming or to claim the same or any part thereof, by, through
or under Assignor, but not otherwise.

                  This Assignment is made with full substitution and subrogation
of Assignee in and to all covenants and warranties by others heretofore given or
made in respect of the 30% Interest or any part thereof. This Assignment is
further subject to the terms of the Exploration Agreement.

                  This Assignment and Bill of Sale may be executed in any number
of counterparts and each of such counterparts shall for all purposes be deemed
to be an original, and all such counterparts shall together constitute but one
and the same Assignment and Bill of Sale.

<PAGE>   2

                  ASSIGNOR AND ASSIGNEE AGREE AND UNDERSTAND THAT, EXCEPT AS
SPECIFICALLY PROVIDED HEREIN, OR IN THE EXPLORATION AGREEMENT, THIS ASSIGNMENT
IS MADE WITHOUT ANY WARRANTY WHATSOEVER, EXPRESS OR IMPLIED (EVEN FOR THE RETURN
OF THE PURCHASE PRICE), INCLUDING ANY IMPLIED WARRANTY OF MERCHANTIBILITY OR
FITNESS FOR A PARTICULAR PURPOSE, AND WITHOUT ANY WARRANTY AGAINST HIDDEN VICES
OR DEFECTS.

                  IN WITNESS WHEREOF, the parties hereto have caused this
Assignment to be duly executed before the undersigned competent witnesses on
this, the 25th day of August, 1998 but effective August 15, 1998.

                                                   ASSIGNOR:

WITNESSES:                                         HUGHES-RAWLS, L.L.C.

/s/ JAMES E. ORTH
------------------------
James E. Orth                                      By:  /s/ JAMES H. RAWLS
Name:  (Please Print)                                 --------------------------
                                                   Name: James H. Rawls
/s/ JOSEPH M. GIANOLA                              Title: President
------------------------
Joseph M. Gianola
Name:  (Please Print)                              ASSIGNEE:

/s/ JAMES E. ORTH                                  ENERGY PARTNERS, LTD
---------------------------
James E. Orth
Name:  (Please Print)
                                                   By:  /s/ RICHARD A. BACHMANN
                                                        -----------------------
/s/ JOSEPH M. GIANOLA                              Name: Richard A. Bachmann
---------------------------                        Title: President
Joseph M. Gianola
Name:  (Please Print)

                                      -2-
<PAGE>   3

STATE OF Louisiana )
                   )
PARISH OF Orleans  )

                  On this 25th day of August, 1998, before me appeared James H.
Rawls, to me personally known, who, being by me duly sworn, did say that he is
the President of Hughes-Rawls, L.L.C., a Delaware limited liability company, and
that said instrument was signed on behalf of said company by authority of its
officers, and said appearer acknowledged that he executed the same as the free
act and deed of said company.

                  IN WITNESS WHEREOF, I have hereunto set my official hand and
seal on the date herein above written.

                                                   /s/ JEAN M. STALLARD
                                                   -----------------------------
                                                   Notary Public in and for
                                                   State of Louisiana

My commission expires at death.

STATE of Louisiana )
                   )
PARISH OF Orleans  )

                  On this 25th day of August, 1998, before me appeared Richard
A. Bachmann, to me personally known, who, being by me duly sworn, did say that
he is the President of Energy Partners, Ltd., a Delaware corporation, and that
said instrument was signed on behalf of said corporation by authority of its
Board of Directors, and said appearer acknowledged that he executed the same as
the free act and deed of said corporation.

                  IN WITNESS WHEREOF, I have hereunto set my official hand and
seal on the date herein above written.

                                                      /s/ JEAN M. STALLARD
                                                      --------------------------
                                                      Notary Public in and for
                                                      State of Louisiana

My commission expires at death.

                                      -3-

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