**UNITED
      STATES**


**SECURITIES
      AND EXCHANGE COMMISSION**


**Washington
      D.C. 20549**


**FORM
      10-Q**


(Mark
      One)




x
            QUARTERLY
                REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
                ACT OF
                1934





For
      the
      quarterly period ended March
      31, 2008





 ̈
            TRANSITION
                REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
                ACT OF
                1934





For
      the
      transition period from _________________ to _________________




Commission
                File No.: 000-49672




**THE
      BLACKHAWK FUND**


(Exact
      name of registrant as specified in its charter)





**Nevada**
            **88-0408213**(State
                or other jurisdiction of
              incorporation
                or organization)
            (I.R.S.
                Employer
              Identification
                No.)**1802
                N. Carson Street, Suite 212-3018**
              **Carson
                City, NV 89701**
              (Address
                of principal executive offices)




Issuer’s
      telephone number: **(775)
      887-0670**







Indicate
      by check mark whether the registrant (1) filed all reports required to be filed
      by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
      preceding 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  ̈




Indicate
      by check mark whether the registrant is a large accelerated filer, a
      non-accelerated filer, or a smaller reporting company. See the definitions
      of
“large accelerated filer,” “accelerated filer” and “smaller reporting company”
in Rule 12b-2 of the Exchange Act.




Large
                accelerated filer  ̈
            
            Accelerated
                filer  ̈Non-accelerated filer  ̈
            (Do not check if a smaller reporting company)
            Smaller reporting company x




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




**APPLICABLE
      ONLY TO CORPORATE ISSUERS**




As
      of May
      15, 2008, 562,293,791 shares of our common stock were
      outstanding.












**PART
        1:**   **FINANCIAL
        INFORMATION**
 
 **ITEM
        1 – CONDENSED FINANCIAL STATEMENTS**
 
 **THE
        BLACKHAWK FUND**
 **BALANCE
        SHEET**
 
 **(unaudited)****March
                    31,**
                  **2008**
              
              **December
                    31,**
                  **2007**ASSETSCash
              
              $
              1,030
              
              
              2,381Prepaid
                  financing costs
              
              
              829
              
              
              829Total
                  current assets
              
              
              1,859
              
              
              3,210Fixed
                  Assets-net
              
              
              4,550
              
              
              5,055Property
                  - held-for-sale/prepaid financing costs
              
              
              1,798,396
              
              
              1,798,604TOTAL
                  ASSETS
              
              $
              1,804,805
              
              $
              1,806,869LIABILITIES
                  AND STOCKHOLDERS’
                  DEFICITLIABILITIESNote
                  Payable
              
              
              19,000
              
              
              22,000Accounts
                  payable and accrued liabilities
              
              $
              31,907
              
              $
              4,240Notes
                  payable-related party
              
              
              801,616
              
              
              827,828Total
                  current liabilities
              
              
              852,523
              
              
              854,068Long
                  term liabilityNote
                  payable
              
              
              1,936,000
              
              
              1,936,000Total
                  Liabilities
              
              
              2,788,523
              
              
              2,790,068Commitments
                  and contingencies
              
              
              -
              
              
              -STOCKHOLDERS’
                  DEFICITPreferred
                  stock, $0.001 par value: Series A, authorized 20,000,000, 0 issued
                  and
                  outstanding
              
              
              -
              
              
              -Preferred
                  stock, Series B, authorized 10,000,000, 10,000,000 issued and
                  outstanding
              
              
              10,000
              
              
              10,000Preferred
                  stock, Series C, authorized 20,000,000, 10,000,000 issued and
                  outstanding
              
              
              10,000
              
              
              10,000Common
                  Stock,$0.001 par value, 4,000,000,000 shares authorized, 562,293,791
                  and
                  341,193,791 shares issued and outstanding at March 31, 2008 and
                  December
                  31, 2007, respectively
              
              
              562,294
              
              
              341,194Common
                        Stock B, $0.001 par value 150,000,000 authorized, 30,000,000
                        issued and
                        outstanding
              
              
              30,000
              
              
              30,000Additional
                  Paid in Capital
              
              
              36,147,744
              
              
              36,252,318Common
                  Stock Subscribed
              
              
              (82,000
              )
              
              (223,862
              )Retained
                  Deficit
              
              
              (37,661,756
              )
              
              (37,402,849
              )Total
                  Stockholders’ Deficit
              
              
              (983,718
              )
              
              (983,199
              )TOTAL
                  LIABILITIES AND STOCKHOLDERS’ DEFICIT
              
              $
              1,804,805
              
              $
              1,806,869
  2
  **THE
        BLACKHAWK FUND**
 **STATEMENTS
        OF OPERATIONS**
 **Three
        Months Ended March 31, 2008 and 2007**
 **(unaudited)**
 
 **March
                      31,**
                    **2****008**
              
              **March
                      31,**
                    **2007**Revenues
              
              $
              15,200
              
              $
              101.778Cost
                  of Sales
              
              
              -
              
              
              53,900Gross
                  Profit
              
              
              15,200
              
              
              47,878**OPERATING
                  EXPENSES**General
                  & Administrative
              
              
              137,590
              
              
              158,949Stock
                  for Services/options
              
              
              92,100
              
              
              1,113,600Interest
                  Expense
              
              
              44,417
              
              
              50,008Total
                  Expenses
              
              
              274,107
              
              
              1,322,557**NET
                  LOSS**
              
              **$**
              (258,907
              )
              **$**
              (1,274,679
              )Basic
                  and Diluted Net Income (Loss) Per Common Share
              
              **$**
              (0.00
              )
              **$**
              (0.02
              )Weighted
                  Average Number of Shares Outstanding
              
              
              **478,871,451**
              
              
              **74,798,590**
  3
  **THE
        BLACKHAWK FUND**
 **STATEMENTS
        OF CASH FLOWS**
 **Three
        Months Ended March 31, 2008 and 2007**
 **(unaudited)**
 
 **March
                      31,**
                    **2008**
              
              **March
                      31,**
                    **2007****Cash
                  Flows From Operating Activities**Net
                  Loss
              
              $
              (258,907
              )
              $
              (1,274,679
              )Adjustments
                        to reconcile net income (loss) to net cash provided by (used
                        in) operating
                        activities:Depreciation
              
              
              505
              
              
              -Stock
                  Issued for Services/option expense
              
              
              92,100
              
              
              1,113,600Changes
                  in:Interest
                  Payable
              
              
              10,888
              
              
              -Other
                  assets (increase)
              
              
              208
              
              
              -Increase
                  (Decrease) in Accounts Payable
              
              
              27,667
              
              
              8,940Net
                  cash used in operating activities
              
              
              (127,539
              )
              
              (152,139
              )Cash
                  Flows From Investing Activities:Purchase
                  of Assets
              
              
              -
              
              
              (82,300
              )Net
                  cash provided by (used in) investing activities
              
              
              -
              
              
              (82,300
              )Cash
                  Flows From Financing Activities:Proceeds
                  from stock subscriptions and option exercises
              
              
              166,288
              
              
              77,000Payments
                  on notes payable – related party
              
              
              (40,100
              )
              
              -Proceeds
                  from notes payable - related party
              
              
              -
              
              
              147,463Net
                  cash provided by financing activities
              
              
              126,188
              
              
              224,463Net
                  Change in Cash
              
              
              (1,351
              )
              
              (9,976
              )Cash
                  Beginning of Period
              
              
              2,381
              
              
              11,748Cash
                  End of Period
              
              
              1,030
              
              
              1,772Supplemental
                  disclosures:Cash
                  paid for:Interest
              
              $
              33,529
              
              $
              37,545Income
                  Taxes
              
              $
              -
              
              $
              -
  4
  **THE
        BLACKHAWK FUND**
 **NOTES
        TO FINANCIAL STATEMENTS**
 **(unaudited)**
 
 **NOTE
        1 - BASIS OF PRESENTATION**
 
 The
        accompanying unaudited interim financial statements of The Blackhawk Fund
        (“Blackhawk” or the “Company”) have been prepared in accordance with accounting
        principles generally accepted in the United States of America and the rules
        of
        the Securities and Exchange Commission (“SEC”), and should be read in
        conjunction with the audited financial statements and notes thereto contained
        in
        Blackhawk’s Annual Report filed with the SEC on Form 10-KSB. In the opinion of
        management, all adjustments, consisting of normal recurring adjustments,
        necessary for a fair presentation of financial position and the results of
        operations for the interim periods presented have been reflected herein.
        The
        results of operations for interim periods are not necessarily indicative
        of the
        results to be expected for the full year. Notes to the financial statements
        which would substantially duplicate the disclosure contained in the audited
        financial statements for 2007 as reported in the 10-KSB have been
        omitted.
 
 **NOTE
        2 - STOCK BASED COMPENSATION**
 
 Prior
        to
        January 1, 2006 we accounted for stock based compensation under Statement
        of
        Financial Accounting Standards No. 123 Accounting for Stock-Based Compensation
        (FAS 123). As permitted under this standard, compensation cost was recognized
        using the intrinsic value method described in Accounting Principles Board
        Opinion No. 25, Accounting for Stock Issued to Employees (APB 25). Effective
        January 1, 2006, the Company has adopted Statement of Financial Accounting
        Standards No. 123 (Revised 2004), Share-Based Payment (FAS 123R) and applied
        the
        provisions of the Securities and Exchange Commission Staff Accounting Bulletin
        No. 107 using the modified-prospective transition method. Prior periods were
        not
        restated to reflect the impact of adopting the new standard. As a result
        of the
        adoption of FAS 123R, stock-based compensation expense recognized during
        the
        quarter ended March 31, 2008 includes compensation expense for all share-based
        payments granted on or prior to, but not yet vested as of December 31, 2006,
        based on the grant date fair value estimated in accordance with the original
        provisions of FAS 123, and compensation cost for all share-based payments
        granted on or subsequent to January 1, 2006, based on the grant date fair
        value
        estimated in accordance with the provisions of FAS 123R.
 
 Beginning
        on January 1, 2006, any future excess tax benefits derived from the exercise
        of
        stock options will be recorded prospectively and reported as cash flows from
        financing activities in accordance with FAS 123R.. During the quarter ended
        March 31, 2008, the Company recorded stock based consulting expense of $92,100,
        as determined under FASB 123R.
 
 **NOTE
        3 - PROPERTY - HELD FOR SALE/FIXED ASSETS**
 
 In
        late
        March 2006, the Company purchased a condominium located in Carlsbad, California
        for $625,083. The Company has renovated the condominium and intends to resell
        it, market conditions permitting. Since the Company intends to sell the
        condominium upon completion of the planned renovations, it has been designated
        as “held-for-sale”. Therefore it will be carried at the lower cost or fair value
        (net of expected sales costs) during the renovation period and will not be
        depreciated. Major improvements and renovations have been capitalized.
  In
        June
        of 2006, the Company entered into a joint venture agreement to renovate and
        then
        sell a residential home located in Oceanside, California. The Company is
        a 50%
        joint venture partner, but has the right to exercise control. The Company
        is
        100% responsible for improvement costs, with these costs to be reimbursed
        upon
        sale and any remaining profits to be split 50/50. The Company has valued
        the
        house at the original value of the liability assumed of $1,000,000. The
        intention on this property is identical to that described above under the
        description related to “held for sale” and depreciation applies. The Company has
        capitalized improvements on this property of $149,817.
  5
  **THE
        BLACKHAWK FUND**
 **NOTES
        TO FINANCIAL STATEMENTS**
 **(unaudited)**
 
 **NOTE
        3 - PROPERTY - HELD FOR SALE/FIXED ASSETS (continued)**
 
 The
        Company has capitalized and depreciated computer equipment with a cost of
        $6,065. The asset is being depreciated over 3 years under the straight line
        method. During the quarter, $505 was depreciated.
  **NOTE
        4 - COMMON STOCK**
 
 During
        the quarter ended March 31, 2008, the Company issued 221,100,000 shares of
        common stock under its stock option plan resulting in an expense of $92,100
        and
        cash received of $141,361.
 
 **NOTE
        5 – NOTES PAYABLE/MORTGAGES PAYABLE**
 
 In
        conjunction with the purchase of the condominium described in Note 3 above,
        the
        Company executed a 30-year adjustable rate promissory note for $496,000.
        The
        initial interest rate on the note is 7.875% and may change on April 1, 2008
        and
        on that date every sixth month thereafter. Pursuant to the terms of the note,
        the Company is required to make interest-only payments for the first 10 years
        (first 120 payments). The initial monthly payments will be $3,225 and may
        change
        beginning on April 1, 2008. The note payable is personally guaranteed by
        the
        Company’s former president.
 
 In
        conjunction with the joint venture property described in Note 3 above, the
        Company refinanced this note in July 2007 and assumed a 50% interest and
        corresponding promissory note debt of $1,440,000. Terms indicate that the
        first
        note is for $1,120,000 over 30 years interest only for the first 10 years.
        The
        second note is carried for $320,000 with interest at 9.875% over 30 years
        interest only for the first 10 years. Monthly amounts are presently $9,983.
        Both
        of the above notes are classified as long term notes payable.
 
 Included
        in short terms note payable is a note to a vendor for $19,000 payable in
        monthly
        installments of $3,000 as settlement for a media invoice.
 
 **NOTE
        6 - RELATED PARTY TRANSACTIONS**
 
 At
        March
        31, 2008, and included as a short term note payable, the Company is indebted
        to
        a formerly related party for $801,616. Interest has been imputed at 6% per
        year.
 
 During
        the quarter ended March 31, 2008, the Company made payments totaling $60,000
        to
        entities controlled by the former CEO and former CFO for consulting
        services.
 
 **NOTE
        7 - GOING CONCERN**
 
 The
        Company has incurred significant losses, has a negative capital, and negative
        current ratio. These factors, among others, indicate that the Company may
        not be
        able to continue as a going concern. No adjustments have been made to the
        carrying value of assets and liabilities should the company not continue
        as a
        going concern.
  6
  **THE
        BLACKHAWK FUND**
 **NOTES
        TO FINANCIAL STATEMENTS**
 **(unaudited)**
 
 **NOTE
        8 - SUBSEQUENT EVENTS**
 
 On
        April
        24, 2008, the Company entered into a stock purchase agreement with Terminus,
        Inc. and Palomar Enterprises, Inc. pursuant to which Terminus purchased
        10,000,000 shares of the Company’s Series C Preferred Stock from Palomar for
        $363,000. As a result, the sale of the Series C Preferred Stock by Palomar
        to
        Terminus effectively transferred Palomar’s control of the company to Terminus,
        giving Terminus approximately 62% of all votes entitled to be cast in any
        matter
        requiring or permitting a vote of stockholders.
 
 On
        April
        24, 2008, the Company and Terminus, Inc., as co-issuers, issued and sold
        to a
        single accredited investor: (i) a $550,000 12% secured promissory note and
        (ii)
        500,000 shares of the Company’s Series A Preferred Stock. To secure payment of
        the note, Terminus pledged the 10,000,000 shares of the Company’s Series C
        Preferred Stock.
 
 On
        April
        24, 2008, the Company filed the following amendments to its Articles of
        Incorporation with the Nevada Secretary of State:
 
 *Amendment
        to Certificate of Designation (Series B Preferred Stock)* .
        Pursuant to this amendment, the Company’s Series B Preferred Stock now contains
        on limitation on conversions such that no holder of Series B Preferred Stock
        can
        convert such shares into the Company’s common stock if such conversion would
        result in the holder owning in excess of 4.99% of the Company’s issued and
        outstanding common stock.
 
 *Certificate
        of Correction.* A
        certificate of amendment to our articles of incorporation was inadvertently
        filed on March 3, 2008 with the Nevada Secretary of State. Accordingly, the
        certificate of correction states that the Amendments set forth in the March
        3,
        2008 filings are rescinded and revoked in their entirety.
 
 *Certificate
        of Withdrawal of Certificate of Designation (Series A Preferred
        Stock)* .
        The
        certificate of designation establishing the Company’s Series A Preferred Stock
        initially filed on July 21, 2004 is withdrawn. No shares of Series A Preferred
        Stock were outstanding as the time of this filing.
 
 *Certificate
        of Designation (Series A Preferred Stock)* .
        The
        Company filed a certificate of designation for 500,000 shares of Series A
        Preferred Stock, par value $0.001 per share. Anytime after October 24, 2008,
        the
        Series A Preferred Stock is convertible based upon the average of the per
        shares
        market value of the Company’s common stock during the 20 trading days
        immediately preceding a conversion date. In addition, upon the consummation
        of a
        bona fide sale third party sale by the Company of its our securities resulting
        in gross proceeds of at least $1,000,000, the Series A Preferred Stock will
        automatically convert into the securities being sold in such offering. There
        are
        no voting rights dividend rights, liquidation preference, redemption rights,
        or
        preemptive rights for the Series A Preferred Stock.
 
 *Amendment
        to Certificate of Designation (Series C Preferred Stock).* The
        Company amended the certificate of designation for its Series C Preferred
        Stock.
        Pursuant to the Amendment, on all matters submitted to a vote of the holders
        of
        the common stock, including, without limitation, the election of directors,
        a
        holder of shares of the Series C Preferred Stock shall be entitled to the
        number
        of votes on such matters equal to the product of (a) the number of shares
        of the
        Series C Preferred Stock held by such holder, (b) the number of issued and
        outstanding shares of the Company’s common stock, on a fully-diluted basis, as
        of the record date for the vote, or, if no such record date is established,
        as
        of the date such vote is taken or any written consent of stockholders is
        solicited, and (c) 0.0000002.
  7
  **ITEM
        2 – MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
        OPERATIONS.**
 
 The
        following discussion and analysis should be read in conjunction with our
        financial statements and related notes included in this report. This report
        contains “forward-looking statements” within the meaning of the Private
        Securities Litigation Reform Act of 1995. The statements contained in this
        report that are not historic in nature, particularly those that utilize
        terminology such as “may,” “will,” “should,” “expects,” “anticipates,”
“estimates,” “believes,” or “plans” or comparable terminology are
        forward-looking statements based on current expectations and assumptions.
        Various risks and uncertainties could cause actual results to differ materially
        from those expressed in forward-looking statements. Please refer to the Risk
        Factors section of our Annual Report on Form 10-KSB for a description of
        these
        risks and uncertainties.
 
 All
        forward-looking statements in this document are based on information currently
        available to us as of the date of this report, and we assume no obligation
        to
        update any forward-looking statements. Forward-looking statements involve
        known
        and unknown risks, uncertainties and other factors that may cause the actual
        results to differ materially from any future results, performance or
        achievements expressed or implied by such forward-looking
        statements.
 
 **General**
 
 The
        Blackhawk fund operates in two lines of business: (1) media and television
        production, and (2) real estate development and investment. In our media
        and
        television production line, we have sought to manage and implement proprietary
        media properties, including cable television shows, infomercials, online
        video
        magazines, and DVDs. In our real estate line, we acquire properties for
        redevelopment and resale, conduct redevelopment and refurbishment of the
        properties, and resell them. We currently hold two properties in our real
        estate
        portfolio.
 
 **Change
        of Control and Change in Management**
 
 On
        April
        24, 2008, we entered into a stock purchase agreement with Terminus, Inc.
        and
        Palomar Enterprises, Inc. pursuant to which Terminus purchased 10,000,000
        shares
        of our Series C Preferred Stock from Palomar for $363,000. As a result, the
        sale
        of the Series C Preferred Stock by Palomar to Terminus effectively transferred
        Palomar’s control of our company to Terminus.
 
 Concurrently,
        Steve Bonenberger resigned as our President and Chief Executive Officer,
        and
        Brent Fouch resigned as our Secretary and Chief Financial Officer. In connection
        therewith, the board of directors increased the number of authorized directors
        from two to three and appointed Frank Marshik to fill the newly created vacancy
        on the board. The board of directors then appointed Mr. Marshik as our
        President, Chief Financial Officer, and Secretary. Thereafter, Mr. Bonenberger
        and Mr. Fouch resigned as directors. Mr. Marshik, as the sole remaining
        director, appointed Terry Ross to fill one of the two vacancies resulting
        from
        these resignations.
 
 **Plan
        of Operation**
 
 Our
        new
        management notes that our company has incurred operating and net losses in
        each
        of the last two fiscal years, had a working capital deficit as of the end
        of the
        latest fiscal year and as of the latest fiscal quarter, and has a large
        accumulated deficit. Accordingly, new management intends to conduct an analysis
        of each of our two business lines to determine the viability of each line
        during
        the second and third quarters of 2008. Within each line of business, management
        will evaluate historical and projected costs in running the line, evaluate
        existing and potential revenue streams, and evaluate the availability of
        additional capital for expansion of the business line. In particular, with
        respect to the real estate business, management intends to evaluate our current
        real estate portfolio in light of current market conditions, both in the
        real
        estate markets and the credit markets. Upon completion of the analysis,
        management will determine whether to seek to expand the business line or
        to
        discontinue or divest of the division. Management may also consider diversifying
        into additional lines of business. In all cases, management may seek to form
        one
        or more partnerships, enter into one or more joint ventures, or conduct one
        or
        more strategic acquisitions.
  8
  **Critical
        Accounting Policies**
 
 The
        discussion and analysis of our financial conditions and results of operations
        is
        based upon our consolidated financial statements, which have been prepared
        in
        accordance with generally accepted accounting principles in the United States.
        The preparation of financial statements requires managers to make estimates
        and
        disclosures on the date of the financial statements. On an on-going basis,
        we
        evaluate our estimates, including, but not limited to, those related to revenue
        recognition. We use authoritative pronouncements, historical experience,
        and
        other assumptions as the basis for making judgments. Actual results could
        differ
        from those estimates. We believe the following critical accounting policies
        affect our more significant judgments and estimates in the preparation of
        our
        consolidated financial statements. A summary of our critical accounting policies
        can be found in the notes to our annual financial statements included our
        Form
        10-KSB for the year ended December 31, 2007.
 
 **Results
        of Operations**
 
 *Basis
        of Presentation*
 
 The
        following table sets forth, for the periods indicated, certain unaudited
        selected financial data:
 
 Three
                  Months EndedMarch
                  31,2008
              
              2007Revenues
              
              $
              15,200
              
              $
              101,778Cost
                  of Sales
              
              
              —
              
              
              53,900General
                  and administrative
              
              
              137,590
              
              
              158,949Stock/Options
                  for Services
              
              
              92,100
              
              
              1,113,600Interest
                  Expense
              
              
              44,417
              
              
              50,008Net
                  income (loss)
              
              
              (258,907
              )
              
              (1,274,679
              )
 
 **Comparison
        of the three months ended March 31, 2008 and 2007**
 
 **Net
        sales.** ** Our
        revenues were $15,200 for the three months ended March 31, 2008, as compared
        to
        $101,778 for the three months ended March 31, 2007. This decrease resulted
        from
        lower demand for our media products and services and a lack of sales of any
        real
        estate properties held for development.
 
 **Cost
        of Sales.** Cost of
        sales were $0 for the three months ended March 31, 2008 as compared to $53,900
        for the three months ended March 31, 2007.
 
 **General
        and administrative.** General
        and administrative expenses decreased to $137,500 for the three months ended
        March 31, 2008 from $158,949 for the three months ended March 31, 2007.
 
 **Stock/Options
        for Services.** Expenses
        resulting from the issuance of our common stock and options to purchase our
        common stock decreased to $92,100 for the first three months ended March
        31,
        2008 from $1,113,600 for the comparable period in the prior fiscal year.
        This
        decrease resulted from a significant reduction in shares and options issued
        for
        services in the first quarter of 2008 as compared to the first quarter of
        2007.
 
 **Interest.** Interest
        expense decreased to $44,417 for the three months ended March 31, 2008 from
        $50,008 for the three months ended March 31, 2007.
 
 **Net
        loss.** We
        incurred an operating loss of $274,104 for the three months ended March 31,
        2008, compared to a net loss of $1,274,679 for the three months ended March
        31,
        2007. The reduction in net loss resulted primarily from a significant reduction
        in shares and options issued for services in the first quarter of 2008 as
        compared to the first quarter of 2007.
  9
  **Liquidity
        and Capital Resources**
 
 We
        have
        financed our operations, debt service, and capital requirements through cash
        flows generated from operations and through issuance of debt and equity
        securities. Our working capital deficit at March 31, 2008 was $850,664, and
        we
        had cash of $1,030 as of March 31, 2008.
  We
        used
        $127,539 of net cash in operating activities for the three months ended March
        31, 2008, compared to using $152,139 in the three months ended March 31,
        2007.
        The net loss of $258,907 was offset by non-cash expenses of $505 in depreciation
        and amortization, $92,100 of stock and options issued for services, an increase
        of $10,888 in interest payable, an increase of $27,667 in accounts payable,
        and
        $208 in decrease in other assets.
 
 We
        neither used nor generated net cash flows from investing activities for the
        three months ended March 31, 2008, whereas we used $82,300 in net cash flows
        from investing activities for the three months ended March 31, 2007.
 
 Net
        cash
        flows provided by financing activities were $126,188 for the three months
        ended
        March 31, 2008, compared to net cash flows provided by financing activities
        of
        $224,463 for the three months ended March 31, 2007. This increase in net
        cash
        provided by financing activities is due to proceeds from the exercise of
        stock
        options and receipt of stock subscriptions of $166,288, offset by repayment
        of
        $40,100 of related party debt.
 
 **Capital
        Requirements**
 
 Our
        financial statements for the fiscal year ended December 31, 2007 state that
        we
        have incurred significant losses, have a negative capital, and a negative
        current ratio. These factors, among others indicate that we may not be able
        to
        continue as a going concern. We believe that, as of the date of this report,
        in
        order to fund our plan of operations over the next 12 months, we will need
        to
        fund its operations out of cash flows generated from operations, from the
        borrowing of money, and from the sale of additional securities. It is possible
        that we will be unable to obtain sufficient additional capital through the
        borrowing of money or the sale of our securities as needed.
 
 Part
        of
        our growth strategy may include diversifying into additional lines of business,
        forming one or more partnerships, entering into one or more joint ventures,
        or
        conducting one or more strategic acquisitions, which may require us to raise
        additional capital. We do not currently have binding agreements or
        understandings to acquire any other companies.
 
 We
        intend
        to retain any future earnings to pay our debts, finance the operation and
        expansion of our business and any necessary capital expenditures, and for
        general corporate purposes.
 
 **Off-Balance
        Sheet Arrangements**
 
 None.
 
 **ITEM
        3 – QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
        RISK**
 
 Not
        applicable. ****
  10
  **ITEM
        4 – CONTROLS AND PROCEDURES**
 
 We
        maintain disclosure controls and
        procedures that are designed to ensure that information required to be disclosed
        in our reports that we file under the Securities Exchange Act of 1934, as
        amended, is recorded, processed, summarized, and reported within the time
        periods specified in the Securities and Exchange Commission’s rules and forms,
        and that such information is accumulated and communicated to our management,
        including our Chief Executive Officer and Chief Financial Officer, as
        appropriate, to allow timely decisions regarding required disclosure based
        on
        the definition of “disclosure controls and procedures” in Rule 13a-15(e). In
        designing and evaluating the disclosure controls and procedures, our management
        recognized that any controls and procedures, no matter how well designed
        and
        operated, can provide only reasonable assurance of achieving the desired
        control
        objectives, and management necessarily was required to apply its judgment
        in
        evaluating the cost-benefit relationship of possible controls and
        procedures.
  At
        the
        end of the period covered by this Quarterly Report on Form 10-Q, we carried
        out
        an evaluation, under the supervision and with the participation of our former
        management, including our former Chief Executive Officer and former Chief
        Financial Officer, of the effectiveness of the design and operation of our
        disclosure controls and procedures. Based on the foregoing, our former Chief
        Executive Officer and our former Chief Financial Officer concluded that our
        disclosure controls and procedures were effective to ensure that all material
        information required to be disclosed in this Quarterly Report on Form 10-Q
        has
        been made known to them in a timely fashion. ****
 
 Our
        former Chief Executive Officer and former Chief Financial Officer have also
        evaluated whether any change in our internal controls occurred during the
        last
        fiscal quarter and have concluded that there were no material changes in
        our
        internal controls or in other factors that occurred during the last fiscal
        quarter that has materially affected, or is reasonably likely to materially
        affect, these controls.
 
 **PART
        II: OTHER INFORMATION**
  **ITEM
        1 – LEGAL PROCEEDINGS**
 
 None.
 
 **ITEM
        2 – CHANGES IN SECURITIES**
 
 (a)
              None.
  (b)
              None.
  (c)
              None.
  **ITEM
        3 – DEFAULT UPON SENIOR SECURITIES**
 
 (a)
              None.
 
 **ITEM
        4 – SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS**
 
 None.
  **ITEM
        5 – OTHER INFORMATION**
  (a)
              None.
 (b)
              None.
  11
  **ITEM
        6 - EXHIBITS**
 
 Item
                No.
              
              Description
              
              Method
                  of Filing3.1
              
              Amendment
                  to Certificate of Designation After Issuance of Class or Series
                  filed with
                  the Nevada Secretary of State on April 24, 2008
              
              Incorporated
                  by reference to Blackhawk’s Current Report on Form 8-K filed on April 30,
                  2008.3.2
              
              Certificate
                  of Correction filed with the Nevada Secretary of State on April
                  24,
                  2008
              
              Incorporated
                  by reference to Blackhawk’s Current Report on Form 8-K filed on April 30,
                  2008.3.3
              
              Certificate
                  of Withdrawal of Certificate of Designation filed with the Nevada
                  Secretary of State on April 24, 2008
              
              Incorporated
                  by reference to Blackhawk’s Current Report on Form 8-K filed on April 30,
                  2008.3.4
              
              Certificate
                  of Designation filed with the Nevada Secretary of State on April
                  24,
                  2008
              
              Incorporated
                  by reference to Blackhawk’s Current Report on Form 8-K filed on April 30,
                  2008.3.5
              
              Amendment
                  to Certificate of Designation After Issuance of Class or Series
                  filed with
                  the Nevada Secretary of State on April 24, 2008
              
              Incorporated
                  by reference to Blackhawk’s Current Report on Form 8-K filed on April 30,
                  2008.10.1
              
              Subscription
                  Agreement dated as of April 24, 2008 by and among Terminus, Inc.,
                  The
                  Blackhawk Fund, and the subscriber set forth on the signature pages
                  thereto
              
              Incorporated
                  by reference to Blackhawk’s Current Report on Form 8-K filed on April 30,
                  2008.10.2
              
              Secured
                  Promissory Note dated as of April 24, 2008
              
              Incorporated
                  by reference to Blackhawk’s Current Report on Form 8-K filed on April 30,
                  2008.10.3
              
              Stock
                  Purchase Agreement dated April 24, 2008 by and among Terminus,
                  Inc., The
                  Blackhawk Fund, and Palomar Enterprises, Inc.
              
              Incorporated
                  by reference to Blackhawk’s Current Report on Form 8-K filed on April 30,
                  2008.31.1
              
              Certification
                  of Frank Marshik pursuant to Rule 13a-14(a)
              
              Filed
                  herewith.32.1
              
              Chief
                  Executive Officer and Chief Financial Officer Certification pursuant
                  to 18
                  U.S.C. § 1350 adopted pursuant to Section 906 of the Sarbanes Oxley Act
                  of
                  2002
              
              Filed
                  herewith.
 
 **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 thereunto
        duly authorized.
 
 THE
                  BLACKHAWK FUNDMay
                  19, 2008
              /s/
                  Frank MarshikFrank
                  MarshikPresident(Principal
                  Executive Officer and Principal
                Accounting
                  Officer)
  12