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Some people have all the luck. When the founders of Webshots.com sold their photo-sharing site to CNET Networks Inc. last week, it was the second time they’d been paid millions for it. The three owners traded the service to ExciteAtHome for nearly $83 million in 1999 only to buy it back in 2002 for $2.4 million when Excite went bankrupt. “It’s lightning strikes twice,” said Heller Ehrman White & McAuliffe partner Jeffrey Selman, who represented Webshots’ owner, Twofold Photos Inc., in the CNET deal. Solo practitioner Thomas Butler, who counsels the Redwood City-based company on day-to-day matters, also represented Twofold in the transaction. Latham & Watkins counseled CNET in the $60 million all-cash deal, which was announced on July 14 and is expected to close in the third quarter of this year. In addition to the $60 million, CNET will pay $10 million cash at the end of three years. San Francisco-based CNET owns numerous technology, business and entertainment Web sites. Lawyers on both sides said the deal progressed smoothly and with remarkable speed. It was negotiated and documented in about two weeks. “There was a big transaction team, so it could have easily gotten complicated,” said Latham associate Bradley Bugdanowitz. “The level of enthusiasm on both sides of the table was very high, which contributed to a very productive atmosphere.” Selman said the deal progressed quickly because it involved only three Twofold shareholders. “They had sufficient capital to not have to answer to anyone but themselves,” he noted. Heller has represented Webshots’ owners since 2001. The three owners ran their site at Excite after selling it to the now defunct high-speed Internet access provider and will continue to do so as CNET employees. Selman said helping the trio buy their company back from Excite during a bankruptcy was far more complicated than selling it to CNET. “The biggest part of the work was getting the assets out of Excite, getting the business set up” and making sure the company complied with the Digital Millennium Copyright Act, he said. Menlo Park-based Selman, who works in Heller’s Venture Law Group unit, led his firm’s team, which included partners Teresa Maloney and Michael Morrissey and associate Larry Wainblat. Executive compensation specialist Keith Betzina in San Francisco also lent a hand. Menlo Park-based corporate partner Ora Fisher led Latham’s team, which included Bugdanowitz and associates Keith Abrams and Thomas Egan. Partner Joseph Yaffe pitched in on employee benefits issues, and partner Laurence Stein in Los Angeles worked on tax concerns. — Adrienne Sanders SNAP GETS SNAPPED Eighteen months after it was spun out of a public company, Snap Appliance Inc. has been snapped up by another public entity. Adaptec Inc. acquired the San Jose company for approximately $91 million in cash and $9 million in assumed stock options. “It’s impressive in this market for a company like Snap to be sold at this value,” said Paul Sieben, a Menlo Park-based associate at O’Melveny & Myers who represented Snap in the deal. Snap makes network-attached storage servers, which connect to networks for file sharing. Quantum Instruments Inc. acquired Snap in 1999 and spun it out as a private company three years later. Milpitas-based Adaptec sells adapters and controllers that connect servers and PCs to storage devices. Adaptec said it expects the transaction to generate more than $40 million in new revenue over the next four quarters. It’s the latest of several acquisitions Adaptec has completed in the last three years. Last month Adaptec acquired data protection products from IBM. Sieben and O’Melveny partner Warren Lazarow led the Snap team. Assisting were tax partner Robert Rizzi and employee benefits partner Jeffrey Walbridge, counsel Alice McTighe and Rebecca Farrington and associates Touraj Parang, Jessica Zhou, Yi- An Chen, Piyush Gupta, Aaron Melville, Steven Chasin, Christopher Decker and Laura Kam. Daniel Winnike, a partner at Fenwick & West, represented Adaptec. His team included intellectual property partner Stephen Gillespie and associates R. Gregory Roussel, Eugene Chung, Connie Chung, Tahir Naim and Greg Sato. — Brenda Sandburg

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