**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 June
      30, 2008





o
            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
o




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 o
            Accelerated filer oNon-accelerated filer o
              (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 o No x




**AP** **PLICABLE
      ONLY TO CORPORATE ISSUERS**




As
      of
      August 14, 2008, 562,293,791 shares of our common stock were
      outstanding.




1


**PART
      1:**   **FINANCIAL
      INFORMATION**





**ITEM
      1 - CONDENSED FINANCIAL STATEMENTS**





**THE
      BLACKHAWK FUND**


**BALANCE
      SHEET**








**(unaudited)****June
                30,**
            
            **December
                31,**ASSETS
            
            **2008**
            
            **2007**Cash
            
            $
            13,824
            
            
            2,381Prepaid
                financing costs
            
            
            24,118
            
            
            24,533Total current assets
            
            
            37,942
            
            
            26,914Fixed
                Assets-net
            
            
            --
            
            
            5,055Property
                - held-for-sale/prepaid financing costs
            
            
            1,774,900
            
            
            1,774,900TOTAL
                ASSETS
            
            $
            1,812,842
            
            $
            1,806,869LIABILITIES
                AND STOCKHOLDERS’ DEFICITLIABILITIESAccounts
                payable and accrued liabilities
            
            $
            59,944
            
            $
            4,240Note
                Payable
            
            
            812,504
            
            
            22,000Notes
                payable-related party
            
            
            46,509
            
            
            827,828Total current liabilities
            
            
            918,957
            
            
            854,068Long
                term liabilityNote
                payable
            
            
            1,936,000
            
            
            1,936,000Total
                Liabilities
            
            
            2,854,957
            
            
            2,790,068Commitments
                and contingencies
            
            
            -
            
            
            -STOCKHOLDERS’
                DEFICITPreferred
                stock, $0.001 par value:Series
                A, authorized 500,000, 500,000 issued and outstanding
            
            
            500
            
            
            -Series
                B, authorized 10,000,000, 10,000,000 issued and
                outstanding
            
            
            10,000
            
            
            10,000Series
                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 June 30, 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
            
            
            36,585,416
            
            
            36,252,318Common
                Stock Subscribed
            
            
            --
            
            
            (223,862
            )Retained
                Deficit
            
            
            (38,240,325
            )
            
            (37,402,849
            )Total Stockholders’ Deficit
            
            
            (1,042,115
            )
            
            (983,199
            )TOTAL
                LIABILITIES AND STOCKHOLDERS’ DEFICIT
            
            $
            1,812,842
            
            $
            1,806,869




See
      accompanying notes to financial statements.




2


**THE
      BLACKHAWK FUND**


**STATEMENTS
      OF OPERATIONS**


**Three
      and Six Months Ended June 30, 2008 and 2007**


**(unaudited)**








**Three
                Months Ended June 30,**
            
            **Six
                Months Ended June 30,****2008**
            
            **2007**
            
            **2008**
            
            **2007**Revenues
            
            $
            4,565
            
            
            173,150
            
            
            19,765
            
            
            274,928Cost
                of Sales
            
            
            --
            
            
            180,131
            
            
            --
            
            
            234,231Gross
                Profit
            
            
            4,565
            
            
            (7,181
            )
            
            19,765
            
            
            40,697**OPERATING
                EXPENSES**General
                & Administrative
            
            
            34,156
            
            
            11,027
            
            
            171,746
            
            
            169,976Stock
                for Services
            
            
            200
            
            
            180,336
            
            
            92,300
            
            
            1,293,936Interest
                Expense
            
            
            548,778
            
            
            33,013
            
            
            593,195
            
            
            83,021Total
                Expenses
            
            
            583,134
            
            
            224,376
            
            
            857,241
            
            
            1,546,933**NET
                LOSS**
            
            $
            (578,569
            )
            
            (231,557
            )
            $
            (837,436
            )
            
            (1,506,236
            )Basic
                and Diluted Net Income (Loss) Per Common Share
            
            $
            (0.00
            )
            
            (0.00
            )
            $
            (0.00
            )
            
            (0.01
            )Weighted
                Average Number of Shares Outstanding
            
            
            562,293,791
            
            
            201,007,864
            
            
            520,582,621
            
            
            143,516,136


See
      accompanying notes to financial statements.









3




**THE
      BLACKHAWK FUND**


**STATEMENTS
      OF CASH FLOWS**


**Six
      Months Ended June 30, 2008 and 2007**


**(unaudited)**








**June
                30,**
            
            **June
                30,****2008**
            
            **2007****Cash
                Flows From Operating Activities**Net
                Loss
            
            $
            (837,436
            )
            $
            (1,506,236
            )Adjustments
                to reconcile net income (loss) to net cashprovided
                by (used in) operating activities:Depreciation
            
            
            505
            
            
            --Stock
                Issued for Services/option expense
            
            
            92,300
            
            
            1,293,936Stock
                Issued for Interest Expense (Financing)
            
            
            500,000
            
            
            --Changes
                in:Other
                assets (increase)
            
            
            415
            
            
            --Increase
                (Decrease) in Accounts Payable
            
            
            55,704
            
            
            411Net
                cash used in operating activities
            
            
            (188,552
            )
            
            (211,889
            )Cash
                Flows From Investing Activities:Sale
                (Purchase) of Assets
            
            
            4,550
            
            
            (82,300
            )Net
                cash provided by (used in) investing activities
            
            
            4,550
            
            
            (82,300
            )Cash
                Flows From Financing Activities:Bank
                Overdraft
            
            
            --
            
            
            8,601Proceeds
                from stock subscriptions and option exercises
            
            
            186,260
            
            
            80,000Payments
                on notes payable - related party
            
            
            (37,324
            )
            
            --Proceeds
                from notes payable - related party
            
            
            46,509
            
            
            193,840Net
                cash provided by financing activities
            
            
            195,445
            
            
            282,441Net
                Change in Cash
            
            
            11,443
            
            
            (11,748
            )Cash
                Beginning of Period
            
            
            2,381
            
            
            11,748Cash
                End of Period
            
            
            13,824
            
            
            --Supplemental
                disclosures:Cash
                paid for:Interest
            
            $
            70,507
            
            $
            59,680Income
                Taxes
            
            $
            -
            
            $
            -




See
      accompanying notes to financial statements.




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, the Company 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 six months ended June 30, 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 six months ended
      June 30, 2008, the Company recorded stock based consulting expense of $92,300,
      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 has completed the
      renovations and intends to sell the condominium, 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) 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 was
      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 had previously capitalized and depreciated computer equipment with
      a
      cost of $6,065. The equipment was assigned to the former controlling stockholder
      of the Company and is no longer carried as an asset.




**NOTE
      4 - COMMON STOCK**





During
      the six month period ended June 30, 2008, the Company issued 221,100,000 shares
      of common stock under its stock option plan resulting in an expense of $92,300
      and cash received of $186,260.





**NOTE
      5 - PREFERRED STOCK**





**Series
      A Preferred Stock**





On
      April
      24, 2008, the Company withdrew its certificate of designation establishing
      the
      Company’s Series A Preferred Stock and filed a new 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 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. The Series A Preferred Stock has no voting rights,
      dividend rights, liquidation preference, redemption rights, or preemptive
      rights.





On
      April
      24, 2008, the Company issued 500,000 shares of the newly designated Series
      A
      Preferred Stock as part of a financing transaction. See Note 6. The Company
      has
      valued the convertible shares using the Black-Scholes model and has recognized
      a
      financing expense equivalent to the stated value of the Series A Preferred
      Stock
      of $500,000.





**Series
      B Preferred Stock**





On
      April
      24, 2008, the Company amended the certificate of designation establishing the
      Company’s 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.





**Series
      C Preferred Stock**





On
      April
      24, 2008, 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.




6


**THE
      BLACKHAWK FUND**


**NOTES
      TO FINANCIAL STATEMENTS**


**(unaudited)**





**NOTE
      6 - 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%. 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 were $3,225 and have since
      been reduced to $2,273. 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, with interest only payments required
      for
      the first 10 years. The second note is carried for $320,000 with interest at
      9.875% over 30 years, with interest only payments required for the first 10
      years. Monthly amounts are presently $9,983. Both of the above notes are
      classified as long term notes payable.





On
      April
      24, 2008, a note payable for $19,000 to a vendor was assumed by Angel
      Acquisition Corp., the former holder of the Company’s Series C Preferred Stock.





On
      April
      24, 2008, the Company issued, and the formerly related party accepted, a
      subordinated secured non-recourse note in the principal amount of $841,828,
      due
      October 24, 2008. The current balance on this note is $812,504. See Note
      7.





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. The Company is considered a guarantor of the note, and
      accordingly, has treated the note as a contingent liability.





**NOTE
      7 - RELATED PARTY TRANSACTIONS**





At
      March
      31, 2008, the Company was indebted to a formerly related party for $801,616.
      Interest had been imputed at 6% per year. On April 24, 2008, the Company issued,
      and the formerly related party accepted, a subordinated secured non-recourse
      note in the principal amount of $841,828, due October 24, 2008. The note is
      secured by the real estate described in Note 3 above, but is subordinated to
      the
      notes described above. The lender’s recovery for default on payment of this note
      is limited to limited solely to the real estate described above. The current
      balance on this note is $812,504.





During
      the six months ended June 30, 2008, the Company made payments totaling $65,000
      to entities controlled by the former CEO and former CFO for consulting
      services.





During
      the six months ended June 30, 2008, Terminus, Inc., the holder of the Company’s
      Series C Preferred Stock, has loaned approximately $45,600 to the Company.
      This
      loan is repayable upon demand.





**NOTE
      8 - 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.





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 acquires and redevelops residential and commercial real estate
      for investment. Once we acquire a property, we redevelop and refurbish the
      properties, seeking to enhance the value of the properties. Once a property
      is
      refurbished, we seek to generate revenue by rental of the property, and we
      also
      seek to resell the properties if market conditions permit. We currently hold
      two
      properties in our real estate portfolio.





Historically,
      we have also operated a media and television production division. In this
      division, we have sought to manage and implement proprietary media properties,
      including cable television shows, infomercials, online video magazines, and
      DVDs. However, as discussed below, management has determined that the ongoing
      media and television production operations are not viable, and accordingly
      has
      determined to discontinue the media and television production
      operations.





**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.





On
      August
      19, 2008, the board of directors reduced the number of authorized directors
      from
      three (3) to one (1). Concurrently therewith, Terry Ross resigned as a director.
      Mr. Ross’ resignation was not due to any disagreements with The Blackhawk Fund
      on matters relating to its operations, policies, and practices.





**Plan
      of Operation**





Our
      new
      management determined 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 has commenced 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
      has evaluated and is evaluating historical and projected costs in running the
      line, existing and potential revenue streams, and the availability of additional
      capital for expansion of the business line. In particular, with respect to
      the
      real estate business, management is evaluating 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.




8





As
      of the
      date of this report, management has determined that, based on its analysis
      of
      the foregoing factors, the media and television production operations are not
      viable. Accordingly, management has determined to discontinue the media and
      television production operations. Management is continuing the evaluation of
      our
      real estate business, the existing real estate portfolio valuations, the
      existing and potential rental possibilities, the current market values, and
      the
      existing financing arrangements. In addition, in light of the distress in the
      real estate markets, management is looking at potential real estate acquisition
      opportunities that, if consummated, would increase and diversify our real estate
      portfolio. Management is also considering 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.





**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 EndedJune 30,
              
              Six
                  Months EndedJune 30,2008
              
              2007
              
              2008
              
              2007Revenues
              
              $
              4,565
              
              $
              173,150
              
              $
              19,765
              
              $
              274,928Costs
                  of Sales
              
              
              --
              
              
              180,131
              
              
              --
              
              
              234,231General
                  and administrative
              
              
              34,156
              
              
              11,027
              
              
              171,746
              
              
              169,976Stock
                  for services
              
              
              200
              
              
              180,336
              
              
              92,300
              
              
              1,293,936Interest
                  Expense
              
              
              548,778
              
              
              33,013
              
              
              593,195
              
              
              83,021Operating
                  income (loss)
              
              $
              (578,569
              )
              $
              (231,557
              )
              $
              (837,436
              )
              $
              (1,506,236
              )




**Comparison
      of the three months ended June 30, 2008 and 2007**





**Net
      sales.** ** Our
      revenues were $4,565 for the three months ended June 30, 2008, as compared
      to
      $173,150 for the three months ended June 30, 2007. This decrease resulted from
      lower demand for our media products and services which resulted in our decision
      to cease our media operations. The decrease also resulted from a lack of sales
      of any real estate properties held for development. Our revenues were generated
      from rental income from our real estate properties.





**Cost
      of Sales.** Our
      costs of sales were $0 for the three months ended June 30, 2008, as compared to
      $180,131 for the three months ended June 30, 2007, all of which resulted from
      our media operations.




9





**General
      and administrative.** General
      and administrative expenses increased to $34,156 for the three months ended
      June
      30, 2008 from $11,027 for the three months ended June 30, 2007.





**Stock/Options
      for Services.** Expenses
      resulting from the issuance of our common stock and options to purchase our
      common stock decreased to $200 for the first three months ended June 30, 2008
      from $180,336 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 second quarter of 2008 as compared to the second quarter of
      2007.





**Interest.** Interest
      expense decreased to $548,778 for the three months ended June 30, 2008 from
      $33,013 for the three months ended June 30, 2007. This increase resulted
      primarily from the issuance of 500,000 shares of Series A Preferred Stock,
      valued at $500,000, in connection with our change of control
      financing.





**Net
      loss.** We
      incurred an operating loss of $578,569 for the three months ended June 30,
      2008,
      compared to a net loss of $231,557 for the three months ended June 30, 2007.
      The
      increase in net loss resulted primarily from the issuance of 500,000 shares
      of
      Series A Preferred Stock, valued at $500,000, in connection with our change
      of
      control financing, which was offset by a significant reduction in shares and
      options issued for services in the second quarter of 2008 as compared to the
      second quarter of 2007.





**Comparison
      of the six months ended June 30, 2008 and 2007**





**Net
      sales.** ** Our
      revenues were $19,765 for the three months ended June 30, 2008, as compared
      to
      $274,928 for the three months ended June 30, 2007. This decrease resulted from
      lower demand for our media products and services which resulted in our decision
      to cease our media operations. The decrease also resulted from a lack of sales
      of any real estate properties held for development. Our revenues were generated
      from rental income from our real estate properties and revenues from our former
      media operations.





**Cost
      of Sales.** Costs of
      sales were $0 for the six months ended June 30, 2008, as compared to $234,231
      for the three months ended June 30, 2007, all of which resulted from our media
      operations.





**General
      and administrative.** General
      and administrative expenses increased to $171,746 for the six months ended
      June
      30, 2008 from $169,976 for the six months ended June 30, 2007.





**Stock/Options
      for Services.** Expenses
      resulting from the issuance of our common stock and options to purchase our
      common stock decreased to $92,300 for the first six months ended June 30, 2008
      from $1,293,936 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 two quarters of 2008 as compared to the first two quarters
      of 2007.





**Interest.** Interest
      expense increased to $593,195 for the six months ended June 30, 2008 from
      $83,021 for the six months ended June 30, 2007. This increase resulted primarily
      from the issuance of 500,000 shares of Series A Preferred Stock, valued at
      $500,000, in connection with our change of control financing.





**Net
      loss.** We
      incurred an operating loss of $837,436 for the six months ended June 30, 2008,
      compared to a net loss of $1,506,236 for the six months ended June 30, 2007.
      The
      reduction in net loss resulted primarily from a significant reduction in shares
      and options issued for services in the first two quarters of 2008 as compared
      to
      the first two quarters of 2007. The reduction was offset by the issuance of
      500,000 shares of Series A Preferred Stock, valued at $500,000, in connection
      with our change of control financing





**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 June 30, 2008 was $881,015, and
      we
      had cash of $13,824 as of June 30, 2008.




We
      used
      $188,552 of net cash in operating activities for the six months ended June
      30,
      2008, compared to using $211,889 in the six months ended June 30, 2007. The
      net
      loss of $837,436 was offset by non-cash expenses of $505 in depreciation and
      amortization, $92,300 of stock and options issued for services, $500,000 of
      stock issued for interest in connection with the change in control financing,
      an
      increase of $55,704 in accounts payable, and an increase of $415 in other
      assets.




10





We
      generated $4,550 net cash flows from investing activities for the six months
      ended June 30, 2008, whereas we used $82,300 in net cash flows from investing
      activities for the six months ended June 30, 2007. The cash flow generated
      from
      investing activities related to the disposition of certain
      equipment.





Net
      cash
      flows provided by financing activities were $195,445 for the six months ended
      June 30, 2008, compared to net cash flows provided by financing activities
      of
      $282,441 for the six months ended June 30, 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 $186,260 and proceeds from related
      party notes payable of $46,509. These cash flows were offset by repayment of
      $37,324 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**





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. The Company is considered a guarantor of the note, and
      accordingly, has treated the note as a contingent liability. In the event that
      Terminus defaults on the note, the Company will become unconditionally liable
      for repayment of all principal and interest then due under the note and will
      incur an expense for the full amount of all such principal and interest. The
      purpose of the Company’s guarantee of the note was to facilitate the change in
      control transaction.





**ITEM
      3 - QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
      RISK**





Not
      applicable. ****




11


**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)
            See
                our current report on Form 8-K filed April 30, 2008 with the
                SEC.




(b)
            None.




(c)
            None.




**ITEM
      3 - DEFAULT UPON SENIOR SECURITIES**





(a)
            None.





**ITEM
      4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS**





On
      May 6,
      2008, stockholders holding a majority of the voting power of Blackhawk took
      action by written consent to amend and restate Blackhawk’s articles of
      incorporation to effectuate the following: (i)
      reduce the minimum number of authorized directors from two (2) to one (1);
      (ii)
      grant authority to the board of directors to effectuate a stock split or reverse
      stock split without stockholder approval; (iii) elect not to be governed by
      certain provisions pertaining to “resident domestic corporations” under the
      Nevada Revised Statutes; and (iv) elect not to be governed by certain provisions
      relating to “issuing corporations” under the Nevada Revised Statutes. These
      stockholders also took action by written consent to adopt a resolution
      authorizing the board of directors to further amend Blackhawk’s articles of
      incorporation to change the name of the company to a name to be determined
      by
      the board of directors in its sole discretion. The amendment to the articles
      of
      incorporation became effective on August 19, 2008. See Blackhawk’s Definitive
      Information Statement on Schedule 14C filed with the Securities and Exchange
      Commission on July 21, 2008 for additional information.




12





**ITEM
      5 - OTHER INFORMATION**




(a)
            On
                April 24, 2008, the Company issued a subordinated secured non-recourse
                note in the principal amount of $841,828, due October 24, 2008, to
                a
                formerly related party to satisfy a demand loan payable. The note
                is
                secured by certain real estate owned by Blackhawk, but is subordinated
                to
                senior loans secured by the real property. The lender’s recovery for
                default on payment of this note is limited to limited solely to the
                real
                estate securing the note.





On
      August
      19, 2008, the board of directors reduced the number of authorized directors
      from
      three (3) to one (1). Concurrently therewith, Terry Ross resigned as a director.
      Mr. Ross’ resignation was not due to any disagreements with The Blackhawk Fund
      on matters relating to its operations, policies, and practices.





(b)
            None.





**ITEM
      6 - EXHIBITS**





ItemNo.
            Description
            Method
                of Filing3.1
            Amended
                and Restated Articles of Incorporation
            Filed
                herewith.10.1
            Subordinated
                Secured Non-Recourse Promissory Note
            Filed
                herewith.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. Sec. 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 FUNDAugust
                19, 2008
            /s/
                Frank MarshikFrank
                MarshikPresident(Principal
                Executive Officer and Principal Accounting Officer)




13