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Unfortunately in Version 5.4 of SQL Backup, the Log Shipping wizard still requires the Full_Seed backup and restore to take place.
However, the good news in Version 5.5 of SQL Backup, you will be able to skip the initializing Full_Seed backup and restore.
SQL Backup V5.5 is scheduled for release during February 2009.
Many Thanks
Eddie
Senior Product Support Engineer
Redgate Software Ltd
Email: support@red-gate.com