Renaissance Capital Growth &, Income

Renaissance Capital Growth &, Income - Recent Material Event

Item 1.01. Entry into a Material Definitive Agreement.

On March 1, 2007, Renaissance Capital Growth & Income Fund III, Inc. (the “Fund”) entered into an amended Investment Advisory Agreement (the “Agreement”) with RENN Capital Group, Inc. (“RENN Group”) pursuant to which RENN Group will continue to serve as the Fund’s investment advisor.

The Agreement clarifies that the Fund will pay RENN Group a management incentive fee in an amount equal to 20% of all net realized capital gains, if any, computed net of all realized capital losses and unrealized capital depreciation of the Fund. The calculation of the incentive fee will not incorporate any offset of unrealized capital depreciation by unrealized capital appreciation. The effect of the use of this method to calculate the incentive fee is that each year, the cumulative performance of the Fund since its inception will provide the basis for the calculation of the incentive fee.

The Agreement also clarifies that the base management fee paid to RENN Group will be assessed following the assessment of the incentive fee. Thus, the base management fee will be calculated net of any incentive fee payable.

The Fund has a material relationship with RENN Group. Russell Cleveland, President, CEO and a Director of the Fund, is the sole director and majority shareholder of RENN Group. Additionally, Barbe Butschek, Secretary and Treasurer of the Fund, is Senior Vice President, Secretary and Treasurer of RENN Group, and is a shareholder of RENN Group.

This description of the Agreement is qualified in its entirety by reference to the full text of the Agreement, a copy of which is attached hereto as Exhibit 10.1 and incorporated herein by reference.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.