SEC Form 4

FORM 4		UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 STATEMENT OF CHANGES IN BENEFICIAL OWNERSHIP Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934 or Section 30(h) of the Investment Company Act of 1940	OMB APPROVAL OMB Number: 3235-0287 Estimated average burden hours per response: 0.5
	Check this box if no longer subject to Section 16. Form 4 or Form 5 obligations may continue. See Instruction 1(b).

1. Name and Address of Reporting Person* Costa Brava Partnership III LP (Last) (First) (Middle) 222 BERKELEY STREET, 17TH FLOOR (Street) BOSTON MA 02116 (City) (State) (Zip)	2. Issuer Name and Ticker or Trading Symbol ISC8 INC. /DE [ ISCI.OB ]	5. Relationship of Reporting Person(s) to Issuer (Check all applicable) Director X 10% Owner Officer (give title below) Other (specify below)
	3. Date of Earliest Transaction (Month/Day/Year) 10/12/2012
	4. If Amendment, Date of Original Filed (Month/Day/Year)	6. Individual or Joint/Group Filing (Check Applicable Line) Form filed by One Reporting Person X Form filed by More than One Reporting Person

Table I - Non-Derivative Securities Acquired, Disposed of, or Beneficially Owned
1. Title of Security (Instr. 3)	2. Transaction Date (Month/Day/Year)	2A. Deemed Execution Date, if any (Month/Day/Year)	3. Transaction Code (Instr. 8)		4. Securities Acquired (A) or Disposed Of (D) (Instr. 3, 4 and 5)			5. Amount of Securities Beneficially Owned Following Reported Transaction(s) (Instr. 3 and 4)	6. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	7. Nature of Indirect Beneficial Ownership (Instr. 4)
			Code	V	Amount	(A) or (D)	Price
COMMON STOCK	10/12/2012	10/12/2012	J(1)		2,632,400(2)	A	$0.1107	51,984,969	D

Table II - Derivative Securities Acquired, Disposed of, or Beneficially Owned (e.g., puts, calls, warrants, options, convertible securities)
1. Title of Derivative Security (Instr. 3)	2. Conversion or Exercise Price of Derivative Security	3. Transaction Date (Month/Day/Year)	3A. Deemed Execution Date, if any (Month/Day/Year)	4. Transaction Code (Instr. 8)		5. Number of Derivative Securities Acquired (A) or Disposed of (D) (Instr. 3, 4 and 5)		6. Date Exercisable and Expiration Date (Month/Day/Year)		7. Title and Amount of Securities Underlying Derivative Security (Instr. 3 and 4)		8. Price of Derivative Security (Instr. 5)	9. Number of derivative Securities Beneficially Owned Following Reported Transaction(s) (Instr. 4)	10. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	11. Nature of Indirect Beneficial Ownership (Instr. 4)
				Code	V	(A)	(D)	Date Exercisable	Expiration Date	Title	Amount or Number of Shares

1. Name and Address of Reporting Person* Costa Brava Partnership III LP (Last) (First) (Middle) 222 BERKELEY STREET, 17TH FLOOR (Street) BOSTON MA 02116 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director X 10% Owner Officer (give title below) Other (specify below)

1. Name and Address of Reporting Person* Roark, Rearden & Hamot LLC (Last) (First) (Middle) 222 BERKELEY STREET, 17TH FLOOR (Street) BOSTON MA 02116 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director X 10% Owner Officer (give title below) Other (specify below)

1. Name and Address of Reporting Person* HAMOT SETH W (Last) (First) (Middle) 222 BERKELEY STREET, 17TH FLOOR (Street) BOSTON MA 02116 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer X Director X 10% Owner Officer (give title below) Other (specify below)

Explanation of Responses:

1. Shares of the issuer's common stock issued, in lieu of cash, as of October 12, 2012 as payment of interest accrued for the Fiscal Quarter ended September 30, 2012 ("Accrued Interest") under and pursuant to the terms of the Subordinated Secured Convertible Notes issued on December 23, 2010, March 31, 2011 and July 1, 2011 to Costa Brava Partnership III LP ("Note"). Such number of shares issued equals the quotient of: (a) the amount of Accrued Interest; and (b) the Interest Conversion Price based on a weighted aveage price per share of the issuer's common stock of $0.1107 as calculated pursuant to the terms of the Note.

2. The securities reported as directly beneficially owned by Costa Brava Partnership III LP may be deemed to be indirectly beneficially owned by Roark, Rearden & Hamot, LLC, and Seth Hamot. Seth Hamot is the President of Roark, Rearden & Hamot, LLC which is the General Partner of Costa Brava Partnership III LP, but each of them disclaims beneficial ownership of any securities, and any proceeds thereof, that exceed its or his pecuniary interest therein, and/or that are not actually distributed to it or him, respectively.

	/s/ Seth W. Hamot, individually and as President of Roark, Rearden & Hamot, LLC on its own behalf and as General Partner on behalf of Costa Brava Partnership III L.P.	10/16/2012
	** Signature of Reporting Person	Date
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* If the form is filed by more than one reporting person, see Instruction 4 (b)(v).
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