<PAGE>

                                                                   EXHIBIT 10.35

                             SEVERANCE AGREEMENT
                             --------------------

THIS SEVERANCE AGREEMENT is made and entered into this 14th day of January,
2000, between Ernest R. Miller ("Employee") and Danka Office Imaging Company and
its parent, subsidiary and related companies, their officers, directors, agents,
employees, or assigns ("Employer").

The purpose of this Severance Agreement is to set forth the terms and conditions
between Employee and Employer in the event they terminate their employment
relationship on conditions stated herein. The parties agree as follows:

1.   Termination. Subject to the terms and conditions set forth herein and in
     -----------
     the attached Release, Employee and Employer agree that, this agreement
     shall become effective if and when employee's employment with employer is
     involuntarily terminated by Employer for other than just cause attributed
     to Employee.

2.   Employer's Payments. In the event of Termination as herein described, the
     -------------------
     parties agree that Employee shall receive the following from Employer in
     consideration of the promises made herein and employee's compliance with
     the terms of this Severance Agreement.

        Employer shall, upon Employee's Termination, make bi-weekly payments of
        Fourteen Thousand Seven Hundred and Sixty-Nine Dollars and Twenty-Three
        Cents, ($14,769.23) each, less, in each case, customary payroll
        deductions through the period ending twelve (12) months from the date of
        Employee's Termination (the "Severance Period").

3.   Full Compensation. The consideration set forth in paragraph 2 will
     -----------------
     compensate the Employee for any and all claims arising out of Employee's
     employment with and Termination from employment with Employer and
     Termination of employment, including but not limited to claims for
     attorney's fees and costs, any and all claims for any type of legal,
     equitable, or statutory relief, and for Employee's future compliance with
     the terms and conditions of this Severance Agreement.

4.   Records, Documents and Property. Employee represents and warrants that
     -------------------------------
     Employee has not taken, or within seven (7) days of Termination, will
     return any of Employer's property, including but not limited to computer
     data, documents and tangible items pertaining to Employer, as well as all
     credit cares, keys, access codes and/or other records, documents or
     property.

5.   General Release of the Employer. In consideration of Employee's entitlement
     -------------------------------
     to the payments and other undertakings stated herein, Employee agrees to
     sign and be bound by the terms of the Release attached herewith as Exhibit
     A on Employee's last day of work with Employer. Employer's obligation to
     make such payments shall commence on the expiration of all rescission
     periods applicable to such release.

1/14/00

<PAGE>


6.   The parties agree that this Agreement applies only to a Termination by
     Employer as described herein. Nothing herein changes Employee's status as
     an employee-at-will. Employer reserves the right to reassign or relocate
     employee to another position in the company without invoking the severance
     obligation herein.

7.   Confidentiality.  Employee agrees to forever treat and maintain as
     ---------------
     confidential all information relating to Employer and its business,
     clients, customers, and prospective clients and customers, including but
     not limited to Employer's customer lists, prospect files, project files,
     job processes, financial information, computer information, imaging
     techniques and methods, business strategies, pricing information, sales and
     marketing plans, and all other information which is not generally known
     outside the Employer.

     Employee also agrees that the terms of this Severance Agreement and
     attached Release, and the facts surrounding Employee's employment and
     Termination from employment with Employer shall forever be treated as
     confidential by Employee, who shall not disclose their terms to anyone,
     except that Employee may disclose the terms of this agreement to Employee's
     legal counsel, accountant and any prospective employer (collectively
     referred to as "Confidential Persons"). Said Confidential Persons shall be
     bound by the Employee's duties of confidentiality. In the event of a breach
     by Employee or any Confidential Person of the terms of this paragraph, any
     remaining payments to Employee shall cease and employee shall immediately
     reimburse Employer for all payments made under this Agreement and the
     Employer shall be relieved of all other duties under this Agreement.

8.   Employer's Remedies.  Employee acknowledges that the violation of Any of
     -------------------
     the terms of this Severance Agreement will cause irreparable harm to
     Employer and agrees that, in addition to any other relief afforded by law,
     an injunction against the violation of the Severance Agreement and Release
     may issue against employee. Both damages and an injunction shall be proper
     modes of relief and are not alternative remedies. If the employer commences
     any action in equity to specifically enforce any of its rights under this
     Severance Agreement, Employee waives and agrees not to assert the defense
     Employer has an adequate remedy at law. All payments under this Severance
     shall cease upon employee's violation of any of its terms.


9.   Non-Compete.  Employee agrees that in return for the payments hereunder,
     -----------
     during the Severance Period, Employee shall refrain from soliciting,
     encouraging, or enticing any current employees of Employer to seek or
     accept employment with another entity. In addition, during the Severance
     Period, Employee will not accept employment and engage in, as an employee,
     consultant, independent contractor or otherwise, activities or duties with
     any company, individual or entity which compete, directly or indirectly,
     with any of Danka's lines of business including, but not limited to, the
     sales and service of copiers, facsimile equipment and related supplies and
     the providing of facilities management, document output or related
     services. Employer may immediately and irrevocably cease payment of any
     sums yet due and owing under this Agreement in the event of Employee's
     violation of this or any other provision of this Agreement.

1/14/00


<PAGE>

10.  Non-Disparagement.  Employee agrees to refrain from making any negative or
     -----------------
     disparaging remarks concerning Employer, its owners, directors, officers,
     employees, customers, vendors, or its products or services.

11.  Cooperation.  As further consideration for the payments hereunder, Employee
     -----------
     agrees to make himself available to assist in the transition of any company
     business to any individual designated by employer, on an "as needed" basis
     for a period not to exceed 90 days from date of Termination. Should any
     travel or other expense be incurred by Employee during such transition,
     Employer will reimburse Employee for such expense. In addition, Employee
     agrees to cooperate fully in any litigation or other dispute involving
     Employer to which Employee is or becomes a material witness. Employee
     agrees to attend and give testimony at depositions, arbitrations, trials
     and any other procedure or dispute resolution upon reasonable notice by
     Employer.

12.  Non-Admission.  Nothing in this Severance Agreement or Release is intended
     -------------
     to be, nor will be deemed to be, an admission of liability by Employer that
     it has violated any state, federal or local statute, local ordinance,
     administrative regulation, or principle of common law, or that it has
     engaged in any wrongdoing.

13.  Non-Assignment.  The parties agree that this Severance Agreement and
     --------------
     Release will not be assignable by either party unless the other party
     agrees in writing, except that Employer may assign such agreement in the
     event there is a sale or disposition of any portion or division of Employer
     which affects Employee position with Employer.

14.  Merger.  This Severance Agreement and Release supersedes all prior oral and
     ------
     written agreements and communications between the parties. Employee agrees
     that any and all claims which Employee might have had against Employer are
     fully released and discharged by this Severance Agreement and Release, and
     that the only claims which may hereafter be asserted against Employer may
     be based only on an alleged breach of the terms of the Severance Agreement.

15.  Entire Agreements.  This Severance Agreement and Release constitute the
     -----------------
     entire agreements between the parties with respect to Employee's
     Termination from employment with the Employer. The parties agree that there
     were no inducements or representations leading to the execution of this
     Severance Agreement or the Release, except as stated herein.

16.  Invalidity.  In case any one or more of the provisions of this Severance
     ----------
     Agreement and Release shall be deemed invalid, illegal, or unenforceable in
     any respect, the validity, legality, and enforceability of the remaining
     provisions contained in this Severance Agreement and release will not in
     any way be affected or impaired.

1/14/00
<PAGE>

17.  Voluntary and Knowing Action.  Employee acknowledges that Employee has been
     ----------------------------
     represented and advised by an attorney, or has had the full opportunity to
     secure such advice, and has read and understands the terms of this
     Severance Agreement and Release, and is voluntarily entering into the
     Severance Agreement and Release to effectuate Termination from Employer.

18.  Rescission.  Employee may rescind this Agreement within seven (7) calendar
     ----------
     days to reinstate federal civil rights claims (if any) and within fifteen
     (15) calendar days to reinstate claims under the Florida Human Rights Act
     (if any). To be effective, any rescission within the relevant time periods
     must be in writing and delivered to Employer, addressed to Ricardo A.
     Davis, Senior Vice President, Human Resources, Danka, 11201 Danka Circle
     North, St. Petersburg. Florida, 33716, either by hand or by mail within the
     appropriate period.

     If sent by mail, the rescission must be (1) postmarked within the relevant
     period; (2) properly addressed to Ricardo A. Davis, Senior Vice President
     Human Resources, Danka, 11201 Danka Circle North, St. Petersburg, Florida
     33716; and (3) sent by certified mail, return receipt requested.

19.  Governing Law.  This Severance Agreement and Release of Claims will be
     -------------
     construed and interpreted in accordance with the laws of the State of
     Florida.

20.  Counterparts.  This Severance Agreement may be executed simultaneously in
     ------------
     two or more counterparts, each of which will be deemed an original, but all
     of which together will constitute one and the same instrument.

     IN WITNESS WHEREOF, the parties, hereto have executed this Severance
     Agreement as of the day and year first above written.

                                            EMPLOYEE:

                                            /s/ Ernest R. Miller
                                            -----------------------------------

Dated:    1/22/, 2000                       President & GM, DSI
          -----------                       -----------------------------------

Dated:     1/14, 2000                       EMPLOYER:
          -----------                          DANKA

                                                By  R. A. Davis
                                                    ---------------------------

                                                Its Sr. Vice President, HR
                                                    ---------------------------
1/14/00
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[LOGO OF DANKA APPEARS HERE]

--------------------------------------------------------------------------------

DATE: April 7, 2000

TO:   Randy Miller

FROM: Ricardo A. Davis
      Senior Vice President,
      Human Resources

RE:   Severance Agreement Addendum

===============================================================================

This will serve as an addendum to the Severance Agreement entered into on
January 14, 2000, revising Paragraph 2, Section 6 to read:

      "The parties agree that this Agreement applies only to a Termination by
      Employer as described herein. Nothing herein changes Employees status as
      an employee-at-will. Employer reserves the right to reassign employee to
      another position in the company without invoking the severance obligation
      herein, except that a reassignment resulting in a base salary reduction of
      20% or greater, or more than fifty miles in work location, will invoke the
      severance obligation herein."

Should you have any questions, please do not hesitate to contact me.


RAD:mll

cc:  David Berg