UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-KSB

  [X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE
                                  ACT OF 1934

                   FOR THE FISCAL YEAR ENDED DECEMBER 31, 2006

                          Commission File No. 000-51739

                            R&R ACQUISITION III, INC.
                                ----------------
                 (Name of Small Business Issuer in its Charter)

            Delaware                                    43-2069362
---------------------------------          ------------------------------------
State or other jurisdiction of                I.R.S. Employer Identification
 incorporation or organization                            Number

                47 School Avenue
              Chatham, New Jersey                        07928
---------------------------------------                ------------
 Address of principal executive office                   Zip Code

                    Issuer's telephone number: (973) 635-4047

                                       N/A
              (Former name, former address and former fiscal year,
                          if changed since last report)

       SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE EXCHANGE ACT

                                      NONE

       SECURITIES REGISTERED PURSUANT TO SECTION 12(G) OF THE EXCHANGE ACT

                         COMMON STOCK, $0.0001 PAR VALUE
                         ------------------------------
                                (Title of Class)

     Check whether the issuer is not required to file reports pursuant to
Section 13 or 15(d) of the Exchange Act. [ ]

     Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.
Yes [X] No [ ]

      Check if there is no disclosure of delinquent filers pursuant to Item 405
of Regulation S-B contained in this form, and no disclosure will be contained,
to the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-KSB or any
amendment to this Form 10-KSB. [X]

      Indicate by check mark whether the issuer is a shell company (as defined
in Rule 12b-2 of the Exchange Act).                               Yes [X] No [ ]

      For the year ended December 31, 2006, the issuer had no revenues.

      As of February 20, 2007, 2,500,000 shares of the issuer's common stock,
par value $0.0001 per share, were outstanding of which none were held by
non-affiliates.

                       DOCUMENTS INCORPORATED BY REFERENCE
                                      NONE

Transitional Small Business Disclosure Format (Check One):        Yes [ ] No [X]


<PAGE>



                    R&R ACQUISITION III, INC. AND SUBSIDIARY

                                   FORM 10-KSB
<TABLE>
<S>            <C>                                                                            <C>
PART I

   Item 1.     Business........................................................................2
   Item 2.     Properties......................................................................8
   Item 3.     Legal Proceedings...............................................................8
   Item 4.     Submission of Matters to a Vote of Security Holders.............................8

PART II

   Item 5.     Market for Common Equity, Related Stockholder Matters
               and Small Business Issuer Purchases of Equity Securities........................8
   Item 6.     Plan of Operation...............................................................8
   Item 7.     Financial Statements...........................................................10
   Item 8.     Change in and Disagreements with Accountants on Accounting
               and Financial Disclosure.......................................................19
   Item 8A.    Controls And Procedures........................................................19
   Item 8B.    Other Information..............................................................19

PART III

   Item 9.     Directors, Executive Officers, Promoters, Control Persons and
               Corporate Governance; Compliance With Section 16(a) of
               the Exchange Act...............................................................19
   Item 10.    Executive Compensation.........................................................21
   Item 11.    Security Ownership of Certain Beneficial Owners and Management and
               Related Stockholder Matters....................................................21
   Item 12.    Certain Relationships and Related Transactions, and Director Independence......22
   Item 13.    Exhibits.......................................................................22
   Item 14.    Principal Accountant Fees and Services.........................................23
</TABLE>
                      FORWARD LOOKING STATEMENT INFORMATION

CERTAIN   STATEMENTS   MADE  IN  THIS   ANNUAL   REPORT  ON  FORM   10-KSB   ARE
"FORWARD-LOOKING  STATEMENTS"  REGARDING THE PLANS AND  OBJECTIVES OF MANAGEMENT
FOR  FUTURE  OPERATIONS.  SUCH  STATEMENTS  INVOLVE  KNOWN  AND  UNKNOWN  RISKS,
UNCERTAINTIES  AND OTHER FACTORS THAT MAY CAUSE OUR ACTUAL RESULTS,  PERFORMANCE
OR ACHIEVEMENTS TO BE MATERIALLY DIFFERENT FROM ANY FUTURE RESULTS,  PERFORMANCE
OR ACHIEVEMENTS  EXPRESSED OR IMPLIED BY SUCH  FORWARD-LOOKING  STATEMENTS.  THE
FORWARD-LOOKING  STATEMENTS  INCLUDED  HEREIN ARE BASED ON CURRENT  EXPECTATIONS
THAT INVOLVE  NUMEROUS  RISKS AND  UNCERTAINTIES.  OUR PLANS AND  OBJECTIVES ARE
BASED, IN PART, ON ASSUMPTIONS  INVOLVING JUDGMENTS WITH RESPECT TO, AMONG OTHER
THINGS,  FUTURE ECONOMIC,  COMPETITIVE AND MARKET CONDITIONS AND FUTURE BUSINESS
DECISIONS,  ALL OF WHICH ARE DIFFICULT OR IMPOSSIBLE TO PREDICT  ACCURATELY  AND
MANY OF WHICH ARE BEYOND OUR CONTROL.  ALTHOUGH WE BELIEVE THAT OUR  ASSUMPTIONS
UNDERLYING THE FORWARD-LOOKING STATEMENTS ARE REASONABLE, ANY OF THE ASSUMPTIONS
COULD  PROVE  INACCURATE  AND,  THEREFORE,  THERE CAN BE NO  ASSURANCE  THAT THE
FORWARD-LOOKING STATEMENTS INCLUDED IN THIS REPORT WILL PROVE TO BE ACCURATE. IN
LIGHT  OF  THE  SIGNIFICANT   UNCERTAINTIES   INHERENT  IN  THE  FORWARD-LOOKING
STATEMENTS  INCLUDED  HEREIN  PARTICULARLY  IN VIEW OF THE CURRENT  STATE OF OUR
OPERATIONS,  THE  INCLUSION  OF SUCH  INFORMATION  SHOULD NOT BE  REGARDED  AS A
STATEMENT  BY US OR ANY OTHER  PERSON  THAT OUR  OBJECTIVES  AND  PLANS  WILL BE
ACHIEVED.  FACTORS THAT COULD CAUSE  ACTUAL  RESULTS TO DIFFER  MATERIALLY  FROM
THOSE EXPRESSED OR IMPLIED BY SUCH  FORWARD-LOOKING  STATEMENTS INCLUDE, BUT ARE
NOT  LIMITED TO, THE FACTORS SET FORTH  HEREIN  UNDER THE  HEADINGS  "BUSINESS,"
"PLAN OF OPERATION" AND "RISK FACTORS".  WE UNDERTAKE NO OBLIGATION TO REVISE OR
UPDATE PUBLICLY ANY FORWARD-LOOKING STATEMENTS FOR ANY REASON.



                                       1
<PAGE>



                                     PART I

ITEM 1. BUSINESS.

INTRODUCTION

         R&R  Acquisition  III, Inc.  ("we",  "our",  "us", the "Company" or the
"Registrant") includes, on a consolidated basis its wholly-owned subsidiary, R&R
Sub III, Inc. (as described  below),  was  incorporated in the State of Delaware
and maintains its principal  offices at 47 School  Avenue,  Chatham,  New Jersey
07928.  The  Company  was  organized  as a vehicle to  investigate  and, if such
investigation  warrants,  acquire  a target  company  or  business  seeking  the
perceived  advantages  of  being a  publicly  held  corporation.  The  Company's
principal business objective for the next 12 months and beyond such time will be
to achieve  long-term growth  potential  through a combination with an operating
business.

         The Company, based on proposed business activities,  is a "blank check"
company.  The  Securities  and Exchange  Commission  (the "SEC")  defines  those
companies  as "any  development  stage  company  that is issuing a penny  stock,
within the meaning of Section 3 (a)(51-1) of the  Exchange  Act, and that has no
specific business plan or purpose, or has indicated that its business plan is to
merge with an  unidentified  company or  companies."  Many states  have  enacted
statutes, rules and regulations limiting the sale of securities of "blank check"
companies in their  respective  jurisdictions.  The Company,  as defined in Rule
12b-2 under the  Securities  Exchange  Act of 1934,  as amended  (the  "Exchange
Act"), also is a "shell company," defined as a company with no or nominal assets
(other than cash) and no or nominal  operations.  Management  does not intend to
undertake  any  efforts to cause a market to develop in our  securities,  either
debt or equity, until we have successfully concluded a business combination. The
Company  intends  to comply  with the  periodic  reporting  requirements  of the
Exchange Act for so long as it is subject to those requirements.

         On December 12, 2006,  we entered into an Agreement  and Plan of Merger
(the  "Merger  Agreement")  with  Ariston  Acquisition  Corp.,  a  newly-formed,
wholly-owned  subsidiary  incorporated  in the State of  Delaware  (the  "Merger
Sub"), and Ariston  Pharmaceuticals,  Inc., a Delaware  corporation  ("Ariston")
pursuant to which the Merger Sub would  merge with and into  Ariston and Ariston
would become a wholly-owned  subsidiary and continue  implementing  its business
plan and operations following the closing (the "Ariston Merger").

         The closing of the Ariston  Merger was  subject to the  fulfillment  by
Ariston of specified  conditions prior to January 31, 2007. On January 31, 2007,
the  conditions to closing the Ariston  Merger were not satisfied by Ariston and
the  Merger  Agreement  was  terminated   thereafter  with  no  further  effect.
Subsequently, on February 9, 2007, the name of Merger Sub was changed to R&R Sub
III, Inc.

COMPETITION

         Our primary  goal is the  acquisition  of a target  company or business
seeking the  perceived  advantages  of being a publicly  held  corporation.  The
Company  faces  vast  competition  from  other  shell  companies  with  the same
objectives.  The Company is in a highly competitive market for a small number of
business  opportunities  which could reduce the  likelihood  of  consummating  a
successful business combination. A large number of established and well-financed
entities,



                                       2
<PAGE>

including  small  public  companies  and venture  capital  firms,  are active in
mergers and  acquisitions of companies that may be desirable  target  candidates
for  us.  Nearly  all  these  entities  have  significantly   greater  financial
resources,   technical  expertise  and  managerial   capabilities  than  we  do;
consequently,  we will be at a competitive  disadvantage in identifying possible
business opportunities and successfully completing a business combination. These
competitive   factors  may  reduce  the  likelihood  of  our   identifying   and
consummating a successful business combination.

EMPLOYEES

         We have no employees.


RISK FACTORS

THERE MAY BE CONFLICTS OF INTEREST BETWEEN OUR MANAGEMENT AND OUR NON-MANAGEMENT
STOCKHOLDERS.

         Conflicts  of  interest  create  the risk that  management  may have an
incentive to act  adversely to the interests of other  investors.  A conflict of
interest may arise between our management's  personal pecuniary interest and its
fiduciary duty to our  stockholders.  Further,  our  management's  own pecuniary
interest may at some point compromise its fiduciary duty to our stockholders. In
addition,  Mr. Kling and Mr. Warshaw, our sole officers,  are currently involved
with other  blank  check  offerings  and  conflicts  in the  pursuit of business
combinations  with  such  other  blank  check  companies  with  which  they  and
affiliates  of  our  majority  stockholders  are,  and  may in  the  future,  be
affiliated  with, may arise.  If we and the other blank check companies that our
officers and directors are affiliated  with desire to take advantage of the same
opportunity,  then those officers and directors  that are  affiliated  with both
companies  would  abstain from voting upon the  opportunity.  Further,  Rodman &
Renshaw, LLC ("Rodman & Renshaw"),  a registered  broker-dealer and affiliate of
our majority stockholder,  may act as our investment banker,  placement agent or
financial consultant to the Company or as an acquisition candidate in connection
with a potential business combination transaction and may receive a fee for such
services.  We cannot  assure  you that  conflicts  of  interest  among  us,  our
management, Rodman & Renshaw and our stockholders will not develop.

OUR BUSINESS IS DIFFICULT TO EVALUATE BECAUSE WE HAVE NO OPERATING HISTORY.

         As the Company  has no  operating  history or revenue and only  minimal
assets,  there is a risk that we will be unable to continue  as a going  concern
and consummate a business  combination.  The Company has had no recent operating
history nor any revenues or earnings from operations since inception. We have no
significant assets or financial resources.  We will, in all likelihood,  sustain
operating  expenses  without   corresponding   revenues,   at  least  until  the
consummation of a business  combination.  This may result in our incurring a net
operating  loss  that  will  increase  continuously  until we can  consummate  a
business  combination with a profitable business  opportunity.  We cannot assure
you that we can  identify a  suitable  business  opportunity  and  consummate  a
business combination.




                                       3
<PAGE>

THERE  IS  COMPETITION  FOR  THOSE  PRIVATE  COMPANIES  SUITABLE  FOR  A  MERGER
TRANSACTION OF THE TYPE CONTEMPLATED BY MANAGEMENT.

         We are in a highly  competitive  market for a small  number of business
opportunities  which could reduce the  likelihood of  consummating  a successful
business combination. We will be an insignificant participant in the business of
seeking mergers with,  joint ventures with and acquisitions of small private and
public  entities.  A large number of  established  and  well-financed  entities,
including  small  public  companies  and venture  capital  firms,  are active in
mergers and  acquisitions of companies that may be desirable  target  candidates
for  us.  Nearly  all  these  entities  have  significantly   greater  financial
resources,   technical  expertise  and  managerial   capabilities  than  we  do;
consequently,  we will be at a competitive  disadvantage in identifying possible
business opportunities and successfully completing a business combination. These
competitive   factors  may  reduce  the  likelihood  of  our   identifying   and
consummating a successful business combination.

FUTURE  SUCCESS IS HIGHLY  DEPENDENT ON THE ABILITY OF  MANAGEMENT TO LOCATE AND
ATTRACT A SUITABLE ACQUISITION.

         The  nature  of our  operations  is highly  speculative  and there is a
consequent risk of loss of your investment. The success of our plan of operation
will  depend  to a great  extent  on the  operations,  financial  condition  and
management of an identified business  opportunity.  We cannot assure you that we
will be successful in locating candidates with established  operating histories.
In the event we complete a business  combination  with a privately held company,
the success of our operations may be dependent upon  management of the successor
firm or venture partner firm and numerous other factors beyond our control.

MANAGEMENT  INTENDS TO DEVOTE ONLY A LIMITED  AMOUNT OF TIME TO SEEKING A TARGET
COMPANY  WHICH  MAY  ADVERSELY   IMPACT  OUR  ABILITY  TO  IDENTIFY  A  SUITABLE
ACQUISITION CANDIDATE AND CONSUMMATE A BUSINESS COMBINATION.

         While seeking a business combination,  management  anticipates devoting
no more than a few hours per month to the Company's  affairs.  Our officers have
not entered into written  employment  agreements with us and are not expected to
do so in the foreseeable  future.  This limited  commitment may adversely impact
our ability to identify and consummate a successful business combination.

THE TIME AND COST OF  PREPARING A PRIVATE  COMPANY TO BECOME A PUBLIC  REPORTING
COMPANY  MAY  PRECLUDE  US FROM  ENTERING  INTO AND  CONSUMMATING  A  MERGER  OR
ACQUISITION WITH THE MOST ATTRACTIVE PRIVATE COMPANIES.

         Target  companies  that fail to comply with SEC reporting  requirements
may  delay or  preclude  business  acquisitions.  Sections  13 and  15(d) of the
Exchange Act require  reporting  companies to provide certain  information about
significant  acquisitions,  including  certified  financial  statements  for the
company acquired,  covering one, two, or three years,  depending on the relative
size of the  acquisition.  The time and additional costs that may be incurred by
some target  entities to prepare these  statements  may  significantly  delay or
essentially  preclude   consummation  of  an  acquisition.   Otherwise  suitable
acquisition  prospects  that do not have or are  unable to obtain  the  required
audited statements may be inappropriate for acquisition so long as the reporting
requirements of the Exchange Act are applicable.



                                       4
<PAGE>

THE  COMPANY  MAY BE  SUBJECT  TO  FURTHER  GOVERNMENT  REGULATION  WHICH  WOULD
ADVERSELY AFFECT OUR OPERATIONS.

         Although  we will be subject to the  reporting  requirements  under the
Exchange Act, management believes we will not be subject to regulation under the
Investment Company Act of 1940, as amended (the "Investment Company Act"), since
we will not be engaged in the business of investing or trading in securities. If
we  engage  in  business  combinations  which  result  in  our  holding  passive
investment interests in a number of entities,  we could be subject to regulation
under the Investment  Company Act. If so, we would be required to register as an
investment  company and could be expected to incur significant  registration and
compliance costs. We have obtained no formal  determination  from the Securities
and Exchange  Commission as to our status under the Investment  Company Act and,
consequently,  violation  of the  Investment  Company  Act could  subject  us to
material adverse consequences.

ANY  POTENTIAL  ACQUISITION  OR MERGER WITH A FOREIGN  COMPANY MAY SUBJECT US TO
ADDITIONAL RISKS.

         If we enter into a business combination with a foreign concern, we will
be  subject  to risks  inherent  in  business  operations  outside of the United
States.  These risks include,  for example,  currency  fluctuations,  regulatory
problems,  punitive tariffs, unstable local tax policies, trade embargoes, risks
related to shipment of raw materials and finished goods across national  borders
and cultural and language differences. Foreign economies may differ favorably or
unfavorably from the United States economy in growth of gross national  product,
rate of inflation,  market  development,  rate of savings,  capital  investment,
resource self-sufficiency balance of payments positions, and in other respect.

THERE IS CURRENTLY NO TRADING MARKET FOR OUR COMMON STOCK.

         Outstanding shares of our common stock cannot be offered, sold, pledged
or otherwise  transferred unless subsequently  registered pursuant to, or exempt
from registration under, the Securities Act of 1933, as amended (the "Securities
Act") and any other applicable  federal or state securities laws or regulations.
These restrictions will limit the ability of our stockholders to liquidate their
investment.  Further,  shares  of our  common  stock  cannot  be sold  under the
exemptions from  registration  provided by Rule 144 under or Section 4(1) of the
Securities  Act, in accordance  with the letter from Richard K. Wulff,  Chief of
the Office of Small Business Policy of the Securities and Exchange  Commission's
Division of Corporation  Finance,  to Ken Worm of NASD  Regulation,  Inc., dated
January 21, 2000.

OUR BUSINESS WILL HAVE NO REVENUES  UNLESS AND UNTIL WE MERGE WITH OR ACQUIRE AN
OPERATING BUSINESS.

         We are a  development  stage  company  and  have had no  revenues  from
operations.  We may not realize any  revenues  unless and until we  successfully
merge with or acquire an operating business.




                                       5
<PAGE>

THE COMPANY INTENDS TO ISSUE MORE SHARES IN A MERGER OR ACQUISITION,  WHICH WILL
RESULT IN SUBSTANTIAL DILUTION.

         Our certificate of  incorporation  authorizes the issuance of a maximum
of  75,000,000  shares of common  stock and a maximum  of  10,000,000  shares of
preferred  stock.  Any merger or  acquisition  effected  by us may result in the
issuance of additional securities without stockholder approval and may result in
substantial  dilution  in the  percentage  of our common  stock held by our then
existing  stockholders.  Moreover, the common stock issued in any such merger or
acquisition  transaction may be valued on an arbitrary or non-arm's-length basis
by our  management,  resulting in an additional  reduction in the  percentage of
common stock held by our then existing stockholders.  Our Board of Directors has
the power to issue any or all of such  authorized  but unissued  shares  without
stockholder  approval.  To the extent that additional  shares of common stock or
preferred  stock  are  issued  in  connection  with a  business  combination  or
otherwise,  dilution to the  interests  of our  stockholders  will occur and the
rights of the holders of common stock might be materially adversely affected

OUR  STOCKHOLDERS MAY ENGAGE IN A TRANSACTION TO CAUSE THE COMPANY TO REPURCHASE
THEIR SHARES OF COMMON STOCK.

         In order to provide an interest in the  Company to a third  party,  our
stockholders may choose to cause the Company to sell Company securities to third
parties,  with the  proceeds  of such sale  being  utilized  by the  Company  to
repurchase shares of common stock held by the stockholders.  As a result of such
transaction,  our management,  principal stockholders and Board of Directors may
change.

THE COMPANY HAS CONDUCTED  LIMITED  MARKET  RESEARCH OF BUSINESS  OPPORTUNITIES,
WHICH MAY AFFECT OUR ABILITY TO IDENTIFY A BUSINESS TO MERGE WITH OR ACQUIRE.

         The  Company  has  conducted   limited   market   research   concerning
prospective business opportunities. Therefore, we have no assurances that market
demand  exists  for a merger or  acquisition  as  contemplated  by us. It may be
expected that any such target business or transaction  will present such a level
of  risk  that  conventional  private  or  public  offerings  of  securities  or
conventional bank financing will not be available. There is no assurance that we
will be able to  acquire  a  business  opportunity  on  terms  favorable  to us.
Decisions  as  to  which   business   opportunity  to  participate  in  will  be
unilaterally made by our management,  which may act without the consent, vote or
approval of our stockholders.

BECAUSE  WE MAY SEEK TO  COMPLETE  A  BUSINESS  COMBINATION  THROUGH A  "REVERSE
MERGER",  FOLLOWING  SUCH A  TRANSACTION  WE MAY  NOT BE  ABLE  TO  ATTRACT  THE
ATTENTION OF MAJOR BROKERAGE FIRMS.

         Additional  risks  may  exist  since we will  assist a  privately  held
business to become public  through a "reverse  merger."  Securities  analysts of
major brokerage firms may not provide  coverage of our Company since there is no
incentive to brokerage  firms to recommend the purchase of our common stock.  No
assurance can be given that  brokerage  firms will want to conduct any secondary
offerings on behalf of our post-merger company in the future.



                                       6
<PAGE>

WE CANNOT  ASSURE YOU THAT  FOLLOWING A BUSINESS  COMBINATION  WITH AN OPERATING
BUSINESS,  OUR  COMMON  STOCK  WILL BE LISTED ON NASDAQ OR ANY OTHER  SECURITIES
EXCHANGE.

         Following a business combination, we may seek the listing of our common
stock on NASDAQ or the American Stock  Exchange.  However,  we cannot assure you
that following such a transaction,  we will be able to meet the initial  listing
standards  of either of those or any other  stock  exchange,  or that we will be
able to  maintain a listing of our common  stock on either of those or any other
stock exchange. After completing a business combination,  until our common stock
is listed on the NASDAQ or another  stock  exchange,  we expect  that our common
stock  would  be  eligible  to  trade  on  the  OTC  Bulletin   Board,   another
over-the-counter   quotation   system,  or  on  the  "pink  sheets,"  where  our
stockholders  may find it more difficult to dispose of shares or obtain accurate
quotations as to the market value of our common stock. In addition,  we would be
subject to an SEC rule that, if it failed to meet the criteria set forth in such
rule,   imposes  various  practice   requirements  on  broker-dealers  who  sell
securities governed by the rule to persons other than established  customers and
accredited  investors.  Consequently,  such rule may deter  broker-dealers  from
recommending  or  selling  our  common  stock,  which  may  further  affect  its
liquidity.  This would also make it more  difficult  for us to raise  additional
capital following a business combination.

THERE IS NO PUBLIC MARKET FOR OUR COMMON STOCK,  NOR HAVE WE EVER PAID DIVIDENDS
ON OUR COMMON STOCK.

         There is no public  trading  market  for our  common  stock and none is
expected  to  develop in the  foreseeable  future  unless and until the  Company
completes a business  combination  with an operating  business and such business
files a registration statement under the Securities Act.  Additionally,  we have
never paid dividends on our common stock and do not presently  intend to pay any
dividends in the foreseeable  future. We anticipate that any funds available for
payment of  dividends  will be  re-invested  into the  Company  to  further  its
business strategy.

AUTHORIZATION OF PREFERRED STOCK.

         Our  Certificate  of  Incorporation  authorizes  the  issuance of up to
10,000,000 shares of preferred stock with  designations,  rights and preferences
determined from time to time by its Board of Directors.  Accordingly,  our Board
of Directors is empowered,  without  stockholder  approval,  to issue  preferred
stock with  dividend,  liquidation,  conversion,  voting,  or other rights which
could  adversely  affect the voting  power or other rights of the holders of the
common stock.  In the event of issuance,  the preferred stock could be utilized,
under certain circumstances, as a method of discouraging, delaying or preventing
a change in control of the  Company.  Although we have no present  intention  to
issue any shares of our authorized  preferred  stock,  there can be no assurance
that we will not do so in the future.






                                       7
<PAGE>


ITEM 2. PROPERTY.

         The  Company's  principal  offices  are  located  at 47 School  Avenue,
Chatham,  New Jersey which are owned by an  affiliated  company of Kirk Warshaw,
chief financial  officer and secretary of the Company.  The Company occupies its
principal  offices on a month to month basis for no rent.  The Company  does not
own or intend  to invest in any real  property.  The  Company  currently  has no
policy with respect to  investments  or  interests  in real estate,  real estate
mortgages or securities of, or interests in, persons  primarily  engaged in real
estate activities.

ITEM 3. LEGAL PROCEEDINGS.

         The  Company is not party to any legal  proceedings  nor is it aware of
any  investigation,  claim or demand  made on the  Company  that may  reasonably
result in any legal proceedings.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

         None.

                                     PART II

ITEM 5. MARKET FOR COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND SMALL BUSINESS
ISSUER PURCHASES OF EQUITY SECURITIES.

(a) MARKET INFORMATION.  The Company's common stock is not trading on any public
trading market or stock exchange.

(b)  HOLDERS.  As of  February  12,  2007,  there were three  record  holders of
2,500,000 shares of the Company's common stock.

(c) DIVIDEND POLICY

         The Company has not  declared or paid any cash  dividends on its common
stock and does not intend to declare or pay any cash dividend in the foreseeable
future. The payment of dividends,  if any, is within the discretion of the Board
of  Directors  and will depend on the  Company's  earnings,  if any, its capital
requirements  and  financial  condition  and such other  factors as the Board of
Directors may consider.

ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.

PLAN OF OPERATION

         Since the  Company's  inception in February  2005, it has not conducted
any active operations except for its efforts to locate a suitable acquisition or
merger  candidate and comply with regulatory  requirements.  No revenue has been
generated  by the Company  since  inception  and it is unlikely the Company will
have any revenues  unless it is able to consummate or effect an acquisition  of,
or merger with, an operating company, of which there can be no assurance.



                                       8
<PAGE>

         The Company's  plan of operation for the next twelve months shall be to
locate a suitable acquisition or merger candidate.  The Company is not currently
engaged in any business  activities that provide cash flow. The Company believes
that its cash requirements for the next twelve months will be paid with money in
its treasury. If additional amounts are needed, the Company believes that it can
satisfy  such   requirement  from  additional  loans  or  investments  from  its
stockholders,  management or other  investors when needed.  Although the Company
anticipates that its cash-on-hand would be able to satisfy its cash requirements
for at least the next twelve  months,  the Company can provide no assurance that
it will be able to do so or that if  additional  amounts are needed that it will
be able to  obtain  such  amounts  from its  stockholders,  management  or other
investors when needed.

RESULTS OF OPERATION

         As of December 31, 2006,  we had no operating  business,  no equipment,
and no  employees.  We do not intend to develop our own  operating  business but
instead plan to merge with another operating company.

         The  Company  had  operating  expenses  of  $29,550  for the year ended
December 31, 2006 and operating expenses of $60,589 for the period from February
14, 2005 (date of  Inception)  to December  31,  2006.  These  expenses  consist
primarily of the legal,  accounting,  general  administrative and filing related
expenses  incurred to prepare and file with the SEC the reports  required of the
Company by the Exchange Act and are of a continuing and recurring nature.

         During the year ended December 31, 2006,  approximately $25,000 of cash
was loaned to the Company from an affiliated  company that is also a stockholder
of the Company.  The loan is  non-interest  bearing and payable on demand.  As a
result,  on December 31, 2006 the Company had $17,344 of cash on hand.  However,
the  Company  also had Total  Current  Liabilities  of $52,883 of which  accrued
expenses were $12,500.  The remainder of the Company's  current  liabilities  is
comprised  of the  related  party loan in the  amount of  $40,383.  The  Company
expects  to meet  its cash  requirements  with  additional  cash  advances  from
stockholders.





                                       9
<PAGE>



ITEM 7.  FINANCIAL STATEMENTS.

                    R&R ACQUISITION III, INC. AND SUBSIDIARY
                          (A Development Stage Company)

                          INDEX TO FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
                                                                                                               PAGE
                                                                                                               ----
<S>                                                                                                       <C>
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM                                                          11


FINANCIAL STATEMENTS

  Consolidated Balance Sheet as of December 31, 2006                                                             12

  Consolidated Statements of Operations for the year ended December 31, 2006, for the period from
     February 14, 2005 (Date of Inception) to December 31, 2005 and for the cumulative period
     from February 14, 2005 (Date of Inception) to December 31, 2006                                             13

  Consolidated Statement of Changes in Stockholders' Deficiency for the period from
     February 14, 2005 (Date of Inception) to December 31, 2006                                                  14

  Consolidated Statements of Cash Flows for the year ended December 31 2006, for the period from
     February 14, 2005 (Date of Inception) to December 31, 2005 and for the cumulative period
     from February 14, 2005 (Date of Inception) to December 31, 2006                                             15


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS                                                                 16 to 18
</TABLE>















                                       10
<PAGE>



             REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors
R&R ACQUISITION III, INC. AND SUBSIDIARY

We have audited the accompanying  consolidated  balance sheet of R&R Acquisition
III, Inc. and  Subsidiary (a development  stage  company) (the  "Company") as of
December 31, 2006 and the related consolidated statements of operations, changes
in stockholders' deficiency and cash flows for the year ended December 31, 2006,
for the period from  February 14, 2005 (Date of  Inception) to December 31, 2005
and for the cumulative  period February 14, 2005 (Date of Inception) to December
31, 2006. These consolidated  financial statements are the responsibility of the
Company's  management.  Our  responsibility  is to  express  an opinion on these
consolidated financial statements based on our audits.

We conducted our audits in accordance  with the standards of the Public  Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements  are free of material  misstatement.  The Company is not  required to
have,  nor were we engaged to perform,  an audit of its  internal  control  over
financial reporting.  Our audit included  consideration of internal control over
financial  reporting  as  a  basis  for  designing  audit  procedures  that  are
appropriate  in the  circumstances,  but not for the  purpose of  expressing  an
opinion on the  effectiveness  of the Company's  internal control over financial
reporting.  Accordingly,  we express  no such  opinion.  An audit also  includes
examining,  on a test basis,  evidence supporting the amounts and disclosures in
the  financial   statements,   assessing  the  accounting  principles  used  and
significant  estimates  made by  management,  as well as evaluating  the overall
financial  statement  presentation.   We  believe  that  our  audits  provide  a
reasonable basis for our opinion.

In our opinion, the consolidated  financial statements referred to above present
fairly, in all material respects, the financial position of R&R Acquisition III,
Inc. and Subsidiary (a  development  stage company) as of December 31, 2006, and
the  consolidated  results of their operations and their cash flows for the year
ended  December  31,  2006,  for the  period  from  February  14,  2005 (Date of
Inception) to December 31, 2005 and for the cumulative  period February 14, 2005
(Date  of  Inception)  to  December  31,  2006  in  conformity  with  accounting
principles generally accepted in the United States of America.



/s/ Marcum & Kliegman LLP

New York, New York
February 8, 2007




                                       11
<PAGE>

                    R&R ACQUISITION III, INC. AND SUBSIDIARY
                          (A Development Stage Company)
                           CONSOLIDATED BALANCE SHEET
                                December 31, 2006


                                     ASSETS
                                     ------
<TABLE>
<S>                                                                         <C>
Current Assets;
      Cash (TOTAL ASSETS)                                                   $           17,344
                                                                            ===================

                            LIABILITIES AND STOCKHOLDERS' DEFICIENCY
                            ----------------------------------------

Current Liabilities;
      Accrued expenses                                                      $            12,500
      Loan payable - related party                                                       40,383
                                                                            -------------------
             TOTAL CURRENT LIABILITIES                                                   52,883
                                                                            -------------------

      COMMITMENTS AND CONTINGENCIES                                                           -

STOCKHOLDERS' DEFICIENCY;
      Preferred stock, $.0001 par value; 10,000,000
             shares authorized, none issued and outstanding                                   -
      Common stock, $.0001 par value; 75,000,000
             shares authorized, 2,500,000 issued and outstanding                            250
      Additional paid-in capital                                                         24,800
      Deficit accumulated during the development stage                                  (60,589)
                                                                            -------------------

             TOTAL STOCKHOLDERS' DEFICIENCY                                             (35,539)
                                                                            -------------------

TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIENCY                              $           17,344
                                                                            ===================
</TABLE>


The  accompanying  notes are an integral  part of these  consolidated  financial
statements.





                                       12
<PAGE>




                    R&R ACQUISITION III, INC. AND SUBSIDIARY
                          (A Development Stage Company)
                      CONSOLIDATED STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
                                                For the              For the period from            For the cumulative period from
                                              year ended              February 14, 2005                   February 14, 2005
                                             December 31,            (Date of Inception)                 (Date of Inception)
                                                 2006               to December 31, 2005                 to December 31, 2006
                                         ---------------------------------------------------    ------------------------------------
<S>                                      <C>                       <C>                            <C>
Expenses
     Professional fees                   $             26,000      $                18,500        $                         44,500
     Formation and other costs                          3,550                       12,539                                  16,089
                                         ---------------------------------------------------    ------------------------------------
        Net Loss                         $            (29,550)     $               (31,039)       $                        (60,589)
                                         ===================================================    ====================================

Weighted average number of common shares            2,500,000                    2,095,313
Net loss per share:
     basic and diluted common share      $              (0.01)     $                 (0.01)
                                         ===================================================
</TABLE>
        The  accompanying  notes  are an  integral  part of  these  consolidated
financial statements.







                                       13
<PAGE>




                    R&R ACQUISITION III, INC. AND SUBSIDIARY
                          (A Development Stage Company)
         CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIENCY
 For the Period from February 14, 2005 (Date of Inception) to December 31, 2006


<TABLE>
<CAPTION>
                                                                                   Deficit
                                                                                 Accumulated
                                                  Common Stock       Additional  During the      Common       Total
                                              ----------------------  Paid-in    Development     Stock     Stockholders'
                                                 Shares     Amount    Capital       Stage      Subscribed   Deficiency
                                              --------------------------------------------------------------------------
<S>                                            <C>         <C>          <C>       <C>           <C>          <C>
Common shares issued                           2,000,000   $     200    $    -    $      -      $     -      $     200
   (February 14, 2005 $0.0001 per
   share)


Contributed capital, February 14, 2005               -           -        24,800         -            -         24,800

Issuance of common stock for
subscription                                     500,000          50         -           -            (50)         -
   (October 31, 2005 $0.0001 per share)


Net loss                                             -           -           -       (31,039)         -        (31,039)
                                              --------------------------------------------------------------------------


Balance at December 31, 2005                   2,500,000         250      24,800     (31,039)         (50)      (6,039)


Proceeds from common stock subscription              -           -           -           -             50           50


Net loss                                             -           -           -       (29,550)         -        (29,550)
                                              --------------------------------------------------------------------------

Balance at December 31, 2006                   2,500,000   $     250   $  24,800   $ (60,589)   $     -      $ (35,539)
                                               =======================================================================
 </TABLE>

The accompanying notes are an integral part of these consolidated financial
statements.



                                       14
<PAGE>

                    R&R ACQUISITION III, INC. AND SUBSIDIARY
                          (A Development Stage Company)
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
                                                             For the          For the period from    For the cumulative period from
                                                            year ended         February 14, 2005            February 14, 2005
                                                           December 31,       (Date of Inception)          (Date of Inception)
                                                               2006           to December 31, 2005        to December 31, 2006
                                                         -----------------------------------------  ---------------------------
<S>                                                            <C>                    <C>                  <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss                                                       $    (29,550)          $   (31,039)          $  (60,589)
Changes in operating assets and liabilities
             (Decrease) increase in accrued expenses                 (3,000)               15,500               12,500
                                                         -----------------------------------------  -------------------
NET CASH USED IN OPERATING ACTIVITIES                               (32,550)              (15,539)             (48,089)
                                                         -----------------------------------------  -------------------

CASH FLOWS FROM FINANCING ACTIVITIES
              Proceeds from sale of common stock                           -                  200                  200
              Proceeds from stock subscription                            50                    -                   50
              Contributed capital                                          -               24,800               24,800
              Proceeds from related party loan                        24,883               15,500               40,383
                                                         -----------------------------------------  -------------------
NET CASH PROVIDED BY FINANCING ACTIVITIES                             24,933               40,500               65,433
                                                         -----------------------------------------  -------------------

NET (DECREASE) INCREASE IN CASH                                      (7,617)               24,961               17,344

CASH AT BEGINNING OF PERIOD                                           24,961                    -                    -
                                                         -----------------------------------------  -------------------
CASH AT END OF PERIOD                                            $    17,344           $   24,961           $   17,344
                                                         =========================================  ===================

SUPPLEMENTAL DISCLOSURE OF CASH FLOWS
INFORMATION

              Interest paid                                        $       -              $     -              $     -
                                                         =========================================  ===================
              Income taxes                                         $       -              $     -              $     -
                                                         =========================================  ===================

NON-CASH FINANCING ACTIVITIES:
Common stock subscribed                                            $       -           $       50            $       -
                                                         =========================================  ===================
</TABLE>


The accompanying notes are an integral part of these consolidated financial
statements.


                                       15
<PAGE>




                    R&R ACQUISITION III, INC. AND SUBSIDIARY
                          (A Development Stage Company)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 - ORGANIZATION, BUSINESS AND OPERATIONS

R&R ACQUISITION  III, INC. AND SUBSIDIARY  (the  "Company") was  incorporated in
Delaware with the objective to acquire, or merge with, an operating business. As
of December 31, 2006, the Company had not commenced any active operations.

The Company, based on proposed business activities,  is a "blank check" company.
The Securities and Exchange  Commission defines such a company as "a development
stage company" that has no specific  business plan or purpose,  or has indicated
that  its  business  plan  is to  engage  in a  merger  or  acquisition  with an
unidentified  company or  companies,  or other  entity or person;  and is issued
`penny stock,' as defined in Rule 3a 51-1 under the  Securities  Exchange Act of
1934. Many states have enacted statutes, rules and regulations limiting the sale
of  securities  of "blank check"  companies in their  respective  jurisdictions.
Management does not intend to undertake any efforts to cause a market to develop
in its securities, either debt or equity, until the Company concludes a business
combination.

The Company was organized as a vehicle to investigate and, if such investigation
warrants,  acquire a target company or business seeking the perceived advantages
of being a publicly  held  corporation  and, to a lesser  extent that desires to
employ the Company's funds in its business.

On December 12, 2006,  the Company  entered into an Agreement and Plan of Merger
(the "Merger  Agreement")  with Ariston  Acquisition  Corp., a newly-formed  (on
November  30,  2006),  wholly  owned  subsidiary  incorporated  in the  State of
Delaware  (the  "Merger  Sub"),  and Ariston  Pharmaceuticals,  Inc., a Delaware
corporation  ("Ariston")  pursuant  to which the Merger Sub would merge with and
into Ariston and Ariston  would become a wholly  owned  subsidiary  and continue
implementing  its  business  plan and  operations  following  the  closing  (the
"Ariston Merger").

The closing of the Ariston  Merger was subject to the  fulfillment by Ariston of
specified  conditions  prior to January  31,  2007.  On January  31,  2007,  the
conditions  to closing the Ariston  Merger were not satisfied by Ariston and the
Merger Agreement terminated thereafter with no further effect.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

USE OF ESTIMATES

The preparation of financial statements in conformity with accounting principles
generally  accepted in the United States of America requires  management to make
estimates  and  assumptions  that  affect  the  reported  amounts  of assets and
liabilities  and disclosure of contingent  assets and liabilities at the date of
the financial statements and reported amounts of revenue and expenses during the
reporting period. Actual results could differ from those estimates.

PRINCIPLES OF CONSOLIDATION

The consolidated  financial  statements  include the accounts of R&R Acquisition
III, Inc. and its wholly-owned  subsidiary R&R Sub III, Inc.  (formerly  Ariston
Acquisition Corp.). All significant inter-company transactions and balances have
been eliminated in consolidation.

DEVELOPMENT STAGE COMPANY

The Company has not generated any revenues to date; accordingly,  the Company is
considered a development  stage  enterprise  as defined in Financial  Accounting
Standards  Board  No.  7,  "Accounting  and  Reporting  for  Development   Stage
Companies."  The  Company is  subject  to a number of risks  similar to those of
other companies in an early stage of development.

CASH AND CASH EQUIVALENTS

For  purposes  of the  statement  of  cash  flows,  the  Company  considers  all
short-term  investments with an original  maturity of three months or less to be
cash equivalents. The Company had no cash equivalents as of December 31, 2006.


                                       16
<PAGE>

                    R&R ACQUISITION III, INC. AND SUBSIDIARY
                          (A Development Stage Company)
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED

INCOME TAXES

The Company accounts for income taxes using the liability method, which requires
the   determination  of  deferred  tax  assets  and  liabilities  based  on  the
differences  between the financial and tax bases of assets and liabilities using
enacted tax rates in effect for the year in which  differences  are  expected to
reverse. Deferred tax assets are adjusted by a valuation allowance, if, based on
the weight of available  evidence,  it is more likely than not that some portion
or all of the deferred tax assets will not be realized.

At December  31, 2006,  the Company has a net  operating  loss carry  forward of
approximately  $61,000  which  will  expire in 2026.  Based on the fact that the
Company has not generated  revenues since  inception,  the deferred tax asset of
approximately  $24,000  has  been  offset  by a full  valuation  allowance.  The
effective tax rate differs from the statutory rate of 34% due to the increase of
the  valuation  allowance  for the  period  from  February  14,  2005  (Date  of
inception)  to December 31, 2005.  The  valuation  allowance  increased  $12,000
during the year ended December 31, 2006.

LOSS PER SHARE

Basic and diluted net loss per share is computed by dividing the net loss by the
weighted-average number of shares of common stock outstanding during the period.
The Company did not have common stock  equivalents  outstanding  during the year
ended  December  31,  2006 and for the period  from  February  14, 2005 (Date of
Inception) to December 31, 2005.

NOTE 3 - LOAN PAYABLE - RELATED PARTY

The  Company  has a loan  payable  of  $40,383  to an  affiliate.  The  loan  is
non-interest bearing and is payable on demand. The loan is uncollateralized.

NOTE 4 - COMMON STOCK

On February 14, 2005 the Company sold  2,000,000  shares of its common stock for
$200. The common stock was sold to an accredited related party investor pursuant
to a Private  Placement  Offering at par value. The stockholder also contributed
an additional amount of $ 24,800.

On October 31, 2005,  the Company sold 500,000  shares of its common stock for $
50. The common stock was sold to two accredited related party investors pursuant
to a Private Placement Offering at par value.

NOTE 5 - PREFERRED STOCK

The Company is authorized  to issue  10,000,000  shares of preferred  stock with
such designations,  voting and other rights and preferences as may be determined
from time to time by the Board of Directors.

NOTE 6 - NEW ACCOUNTING STANDARDS

Management  does not believe that any recently  issued,  but not yet  effective,
accounting standards,  if currently adopted, would have a material effect on the
accompanying financial statements.







                                       17
<PAGE>



                    R&R ACQUISITION III, INC. AND SUBSIDIARY
                          (A Development Stage Company)
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

NOTE 7 - COMMITMENTS AND CONTINGENCIES

LITIGATION

The  Company  may be involved  in  litigation  through the normal  course of its
business  purpose.  The Company believes that the resolution of these unforeseen
matters will not have a material adverse effect on the financial position of the
Company.

OFFICE SPACE

The Company  utilizes the office space and equipment of its officer and director
at no cost on a month to month basis.  Management  estimates  such amounts to be
immaterial.

NOTE-8 - SUBSEQUENT EVENTS

On January 31, 2007,  the  conditions to the closing of the Ariston  Merger were
not fulfilled and the Merger  Agreement  terminated  thereafter  with no further
effect.

On February 9, 2007, the name of Merger Sub was changed to R&R Sub III, Inc.







                                       18
<PAGE>

ITEM  8.  CHANGES  IN AND  DISAGREEMENTS  WITH  ACCOUNTANTS  ON  ACCOUNTING  AND
FINANCIAL DISCLOSURE.

         None.

ITEM 8A. CONTROLS AND PROCEDURES.

         The  Company's   management  is  responsible   for   establishing   and
maintaining a system of disclosure  controls and  procedures (as defined in Rule
13a-15(e) and 15d-15(e)  under the Exchange Act) that is designed to ensure that
information  required to be  disclosed  by the  Company in the reports  that the
Company  files  or  submits  under  the  Exchange  Act is  recorded,  processed,
summarized and reported,  within the time periods  specified in the Commission's
rules and forms. Disclosure controls and procedures include, without limitation,
controls  and  procedures  designed  to ensure that  information  required to be
disclosed  by an  issuer  in the  reports  that it files or  submits  under  the
Exchange  Act  is  accumulated  and  communicated  to the  issuer's  management,
including its principal  executive  officer or officers and principal  financial
officer or officers, or persons performing similar functions,  as appropriate to
allow timely decisions regarding required disclosure.

         In accordance with Exchange Act Rules 13a-15 and 15d-15,  an evaluation
was completed under the supervision and with the  participation of the Company's
management,  including the Company's  principal  executive officer and principal
financial  officer,  of the  effectiveness  of the design and  operation  of the
Company's disclosure controls and procedures as of the end of the period covered
by this  Annual  Report.  Based  on that  evaluation,  the  Company's  principal
executive  officer and principal  financial officer concluded that the Company's
disclosure  controls  and  procedures  are  effective,   to  provide  reasonable
assurance  that  information  required to be disclosed in the Company's  reports
filed or submitted  under the Exchange Act is recorded,  processed,  summarized,
and  reported  within the time  periods  specified in the SEC's rules and forms.
There have been no changes to the Company's  internal  controls  over  financial
reporting  that  occurred  during  its last  fiscal  quarter  of the year  ended
December  31, 2006,  that  materially  affected,  or were  reasonably  likely to
materially affect, its internal controls over financial reporting.


ITEM 8B. OTHER INFORMATION.

         None.



                                    PART III

ITEM 9. DIRECTORS,  EXECUTIVE OFFICERS, PROMOTERS, CONTROL PERSONS AND CORPORATE
        GOVERNANCE; COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT.

        The following table sets forth  information  concerning our officers and
sole director as of February 1, 2007:

NAME                      AGE     TITLE
----                      ---     -----
Arnold P. Kling           48      President and sole director
Kirk M. Warshaw           48      Chief financial officer and secretary



                                       19
<PAGE>

            ARNOLD  P.  KLING.  Mr.  Kling  has  served  as a  director  and our
president since November 5, 2005. Mr. Kling is currently a Managing  Director of
GH Venture  Partners,  LLC, a private equity and merchant  banking  boutique for
which he also served as a Managing  Director  and General  Counsel  from 1995 to
1999.  From 1999 through  August 2005,  Mr. Kling was the  president of Adelphia
Holdings,  LLC,  a  merchant-banking  firm,  as well as the  managing  member of
several private  investment  funds.  From 1993 to 1995 he was a senior executive
and General Counsel of Buckeye  Communications,  Inc., a Nasdaq listed licensing
and multimedia  company.  From 1990 through 1993, Mr. Kling was an associate and
partner in the  corporate  and  financial  services  department  of  Tannenbaum,
Helpern,  Syracuse &  Hirschtritt  LLP, a mid-size New York law firm.  Mr. Kling
received a Bachelor of Science degree from New York University in  International
Business in 1980 and a Juris Doctor degree from Benjamin  Cardozo  School of Law
in 1983.  Mr. Kling  currently  serves as a director and president of Twin Lakes
Delaware,  Inc.,  R&R  Acquisition  V,  Inc.,  R&R  Acquisition  VI,  Inc.,  R&R
Acquisition VII, Inc., R&R Acquisition  VIII,  Inc., R&R Acquisition,  IX, Inc.,
R&R  Acquisition  X, Inc.  (each a  publicly  reporting,  non-trading  company),
Enthrust   Financial   Services,   Inc.   (OTCBB:EFSV)   and  24Holdings,   Inc.
(OTCBB:TWFH).

            KIRK M.  WARSHAW.  Mr.  Warshaw  has  served as our chief  financial
officer  and  secretary  since  November  5, 2005.  Mr.  Warshaw is a  financial
professional  who, since 1990, has provided  clients in a multitude of different
industries with advice on accounting,  corporate  finance,  and general business
matters.  Prior to starting his own consulting  firm, from 1983 to 1990, he held
the various titles of controller,  chief financial officer, president, and chief
executive officer at three separate financial  institutions in New Jersey.  From
1980 through 1983, Mr. Warshaw was a Senior  Accountant at the public accounting
firm of  Deloitte,  Haskins & Sells.  Mr.  Warshaw is a 1980  graduate of Lehigh
University and has been a CPA in New Jersey since 1982. Mr. Warshaw is currently
the chief financial  officer of Twin Lakes Delaware,  Inc., R&R Acquisition VII,
Inc., R&R Acquisition V, Inc., R&R  Acquisition VI, Inc., R&R Acquisition  VIII,
Inc., R&R Acquisition,  Inc., IX, and R&R Acquisition, Inc., X, (each a publicly
reporting,  non-trading company),  the chief financial officer and a Director of
24Holdings,  Inc.  (OTCBB:TWFH),  a director of Empire Financial Holding Company
(AMEX:EFH), and a director of two privately owned entities.

            Mr. Kling and Mr. Warshaw are not required to commit their full time
to our business affairs and they will not devote a substantial amount of time to
our business affairs.

COMPENSATION AND AUDIT COMMITTEES

         As we only have one board member and given our limited  operations,  we
do not have separate or independent audit or compensation committees.  Our Board
of Directors has determined that it does not have an "audit committee  financial
expert," as that term is defined in Item 401(e) of Regulation  S-B. In addition,
we have not adopted  any  procedures  by which our  stockholders  may  recommend
nominees to our Board of Directors.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

         Section  16(a) of the Exchange Act requires our directors and executive
officers  and persons who  beneficially  own more than ten percent of our common
stock  (collectively,  the "Reporting Persons") to report their ownership of and
transactions  in our common stock to the SEC.  Copies of these  reports are also
required to be supplied  to us. To our  knowledge,  during the fiscal year ended
December 31, 2006 the Reporting  Persons  complied with all  applicable  Section
16(a) reporting requirements.


                                       20
<PAGE>

CODE OF ETHICS

            We have not adopted a Code of Ethics  given our limited  operations.
We expect that our Board of  Directors  following a merger or other  acquisition
transaction will adopt a Code of Ethics.

ITEM 10. EXECUTIVE COMPENSATION.

            Arnold Kling and Kirk Warshaw are our sole officers and Arnold Kling
is our sole  director.  Neither  receives  any  regular  compensation  for their
services rendered on our behalf.  Neither Mr. Kling nor Mr. Warshaw received any
compensation  during the year ended December 31, 2006. No officer or director is
required  to make  any  specific  amount  or  percentage  of his  business  time
available to us.

         While  we  do  not  presently   anticipate  engaging  the  services  of
professional  firms that  specialize  in finding  business  acquisitions  on any
formal basis,  we may engage such firms in the future,  in which event we may be
required to pay a finder's fee or other compensation. In no event, however, will
we pay a finder's fee or  commission to any of our officers and directors or any
entity  with which an  officer or  director  is  affiliated.  We do not have any
incentive or stock option plan in effect.

DIRECTOR COMPENSATION

         We do not currently pay any cash fees to our  directors,  nor do we pay
directors' expenses in attending board meetings.

EMPLOYMENT AGREEMENTS

         The Company is not a party to any employment agreements.

ITEM 11.  SECURITY  OWNERSHIP OF CERTAIN  BENEFICIAL  OWNERS AND  MANAGEMENT AND
RELATED STOCKHOLDER MATTERS.

         The following  tables set forth certain  information  as of February 1,
2007,  regarding (i) each person known by the Company to be the beneficial owner
of more than 5% of the outstanding  shares of the Company's  common stock,  (ii)
each  director,  nominee  and  executive  officer of the  Company  and (iii) all
officers and directors as a group.
<TABLE>
<CAPTION>
                                             AMOUNT AND NATURE OF
                NAME AND ADDRESS (1)         BENEFICIAL OWNERSHIP      PERCENTAGE OF CLASS
                --------------------         --------------------      -------------------
<S>                                         <C>                       <C>
Arnold P. Kling (2)                         400,000                   16%
712 Fifth Avenue, 11th Floor
New York, New York 10019

Kirk Warshaw (3)                            100,000                   4%
47 School Avenue
Chatham, New Jersey 07928

R&R Investments III, LLC                    2,000,000                 80%
1270 Avenue of Americas, 16th Floor
New York, New York 10020

All Directors and Officers as a Group       500,000                   20%
(2 individuals)
</TABLE>

----------------------------------------
     (1) Unless  otherwise  indicated,  the  company has been  advised  that all
     individuals  or entities  listed have the sole power to vote and dispose of
     the  number of shares set forth  opposite  their  names.  For  purposes  of
     computing  the  number and  percentage  of shares  beneficially  owned by a
     security  holder,  any shares  which  such  person has the right to acquire
     within 60 days from  February  1, 2007 are  deemed to be  outstanding,  but
     those shares are not deemed to be outstanding  for the purpose of computing
     the percentage ownership of any other security holder.

     (2) Mr. Kling is the president and sole director of the Company.

     (3) Mr.  Warshaw  is the  secretary  and  chief  financial  officer  of the
     Company.

     We currently do not maintain any equity compensation plans.

                                       21
<PAGE>

ITEM  12.  CERTAIN   RELATIONSHIPS  AND  RELATED   TRANSACTIONS,   AND  DIRECTOR
INDEPENDENCE.

            During the year ended  December 31, 2006,  approximately  $25,000 of
cash was loaned to the Company from an affiliated company,  R&R Investments III,
LLC, that is also a stockholder of the Company. The loan is non-interest bearing
and payable on demand. As of February 12, 2007, the principal amount of the loan
remains outstanding.

            Arnold Kling is president and sole director of the Company.

ITEM 13. EXHIBITS.

Exhibit       Description
-------       -----------

    *3.1      Certificate of Incorporation

    *3.2      Amendment to Certificate of Incorporation

    *3.3      By-laws

    31.1      Certification  of  the  Company's   principal   executive  officer
              pursuant to Section 302 of the  Sarbanes-Oxley  Act of 2002,  with
              respect to the  registrant's  Annual Report on Form 10-KSB for the
              year ended December 31, 2006

    31.2      Certification  of  the  Company's   principal   financial  officer
              pursuant to Section 302 of the  Sarbanes-Oxley  Act of 2002,  with
              respect to the  registrant's  Annual Report on Form 10-KSB for the
              year ended December 31, 2006

    32.1      Certification  of  the  Company's   principal   executive  officer
              pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section
              906 of the Sarbanes Oxley Act of 2002.

   32.2       Certification  of  the  Company's   principal   financial  officer
              pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section
              906 of the Sarbanes Oxley Act of 2002.

---------------------
*        Filed as an exhibit to the  Company's  registration  statement  on Form
         10-SB, as filed with the Securities and Exchange  Commission on January
         19, 2006, and incorporated herein by this reference.



                                       22
<PAGE>

ITEM 14.   PRINCIPAL ACCOUNTANT FEES AND SERVICES

         During  the period  from  February  14,  2005  (date of  inception)  to
December 31,  2006,  we retained  Marcum & Kliegman  LLP to provide  services as
follows:


2006 FEES                                                              AMOUNT
---------                                                              ------

Audit Fees (1)                                                         $8,000
Audit-Related Fees                                                        -
Tax Fees                                                                  -
All Other Fees                                                            -

2005 FEES                                                              AMOUNT
---------                                                              ------

Audit Fees (2)                                                         $6,500
Audit-Related Fees                                                        -
Tax Fees                                                                  -
All Other Fees                                                            -

-----------------------
     (1) Comprised of the audit of our financial  statements for the period from
     January 1, 2006 to December  31,  2006.  (2)  Comprised of the audit of our
     financial  statements  for the  period  from  February  14,  2005  (date of
     inception) to December 31, 2005.

PRE-APPROVAL POLICY

            We do not  currently  have a  standing  audit  committee.  The above
services were approved by our Board of Directors.






                                       23
<PAGE>



                                   SIGNATURES

         In accordance with Section 13 or 15(d) of the Exchange Act of 1934, the
registrant has caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.

                                                     R&R ACQUISITION III, INC.


Dated: February 20, 2007                             By:  /s/ ARNOLD P. KLING
                                                         -------------------
                                                     Arnold P. Kling
                                                     President



            In  accordance  with the Exchange  Act,  this report has been signed
below by the following persons on behalf of the registrant and in the capacities
and on the dates indicated.

Date: February 20, 2007


                                    By: /s/ ARNOLD P. KLING
                                    -----------------------
                                    Arnold P. Kling, President, Sole Director
                                    (Principal Executive Officer)



Date: February 20, 2007

                                    By: /s/ Kirk M. Warshaw
                                    ---------------------------
                                    Kirk M. Warshaw, Chief Financial Officer
                                    (Principal Financial and Accounting Officer)