<PAGE>
                                                                   Exhibit 10.35

                      INTEGRATED INFORMATION SYSTEMS, INC.

                    SEPARATION AGREEMENT AND GENERAL RELEASE

         This Separation Agreement and General Release (this "Agreement") is
between David Wirthlin ("Employee") and INTEGRATED INFORMATION SYSTEMS, INC.
("IIS"), and is dated as of the date set forth next to Employee's signature.

RECITALS:

          1. Employee was employed by IIS under an Employment Agreement dated
September 29, 1997.

          2. Employee was granted 75,000 options by IIS pursuant to an initial
Stock Option Agreement dated September 29, 1997.

          3. Employee and Employer mutually terminated their employment
relationship and their Employment Agreement effective September 28, 2001 upon
the terms and conditions set forth below.

TERMS AND CONDITIONS:

Section 1.        Termination of Employment. Upon the mutual agreement of IIS
---------         -------------------------
                  and Employee, the employment of Employee with IIS was
                  terminated without cause effective September 28, 2001.
                  Employee intentionally and knowingly waived any notice
                  provisions, including any set forth in the Employment
                  Agreement.

Section 2.        Lapse of Options. Notwithstanding paragraph 7(a) of the
---------         ----------------
                  Stock Option Agreement dated September 29, 1997, all options
                  shall lapse three (3) months after the date of termination or
                  December 28, 2001.

Section 3.        Consideration. In consideration of (a) the covenants of
---------         -------------
                  Employee set forth in this Agreement, (b) Employee's agreement
                  to accelerate the lapsing of stock

<PAGE>

                  options as described in Section 2, and (c) Employee's release
                  of all claims, disputes and causes of action which Employee.
                  Employee's heirs, attorneys, executors, administrators or
                  assigns have or may have against IIS, its predecessors, or any
                  other related entity, IIS agrees to pay to Employee on the
                  eighth day following Employee's execution of this Agreement,
                  provided Employee has not revoked this Agreement pursuant to
                  Section 8, an amount equal to six months of his current salary
                  subject to appropriate payroll tax and benefits withholdings.

Section 4.        Restrictive Covenants. The parties agree that the Employment
---------         ---------------------
                  Agreement is terminated as of September 28, 2001, but that all
                  post-termination provisions of the Employment Agreement,
                  including but not limited to those set forth in Sections 7 and
                  8 of the Employment Agreement, shall remain in effect and are
                  binding upon Employee as defined in the Employment Agreement.
                  Employee further agrees that he will not initiate any public
                  statement concerning or relating to the business affairs of
                  IIS.

Section 5.        Mutual Release. Each party, on behalf of himself or itself
---------         --------------
                  and his or its heirs, attorneys, executors, successors,
                  administrators and assigns, does hereby release, acquit and
                  forever discharge the other party and his or its respective
                  successors, assigns, subsidiaries, divisions, affiliated
                  companies and benefit plans and its respective present and
                  former affiliates, directors, officers, fiduciaries,
                  employees, agents, successors and assigns, from any and all
                  liabilities, damages, causes of action and claims of any
                  nature, kind or description whatsoever, whether accrued or to
                  accrue, which wither party ever had, now has or hereafter may
                  have against any of them, know or unknown, that are based on
                  facts occurring the day of or prior to the day the parties
                  execute this Agreement, including, but not limited to, any
                  claims

<PAGE>

                  under any state or federal law or statute, including, but not
                  limited to, the Age Discrimination in Employment Act of 1967,
                  the Americans with Disabilities Act of 1990, the Civil Rights
                  Acts of 1964 and 199l, and Family and Medical Leave Act, any
                  applicable workers' compensation law, and any claim (state
                  tort, contract or otherwise), matter or action related to
                  Employee's employment and/or affiliation with, or termination
                  and separation from, IIS and its affiliates.

Section 6.        No Release of Vested Benefits. Notwithstanding anything in
---------         -----------------------------
                  Section 5 above, Employee does not by this Agreement waive any
                  rights Employee may have to vested benefits or account
                  balances in any retirement plan which vested benefits or
                  account balances, as the case may be, shall be paid over to
                  Employee in accordance with the provisions of the respective
                  plans.

Section 7.        Confidentiality. As a material inducement to enter into
---------         ---------------
                  this Agreement, each party represents and agrees that he or it
                  will keep all terms of this Agreement completely confidential,
                  and that he or it will not disclose any information concerning
                  this Agreement to any person, including, but not limited to,
                  any past, present or prospective employee of IIS. Each party
                  further agrees that disclosure by Employee of the terms and
                  conditions of this Agreement in violation of this Section
                  constitutes a material breach of this Agreement.

Section 8.        Acknowledgments. Employee acknowledges, represents and agrees,
---------         ---------------
                  in compliance with the Older Workers Benefit Protection Act:

                  (i)     that Employee has been fully informed and is fully
                          aware of Employee's right to discuss any and all
                          aspects of this matter with an attorney of Employee's
                          choice;

<PAGE>

                  (ii)    that Employee has carefully read and fully understands
                          all of the provisions of this Agreement;

                  (iii)   that Employee has had up to and including a full
                          twenty-one (21) days within which to consider this
                          Agreement before executing it;

                  (iv)    that Employee has a full seven (7) days following the
                          execution of this Agreement to revoke this Agreement
                          and had been and hereby is advised in writing that
                          this Agreement shall not become effective or
                          enforceable until the revocation period has expired;

                  (v)     that Employee has had adequate time to consider this
                          Agreement before executing it; and

                  (vi)    that Employee accepts the terms of this Agreement as
                          fair and equitable under all the circumstances and
                          voluntarily executes this Agreement.

Section 9.        Non-Disparagement. Neither party shall disparage the other.
----------        ------------------
                  Employee shall refrain from making any statement that is
                  critical or derogatory of any IIS operation or about any
                  employee of IIS. Neither party shall disclose to any third
                  party the conditions of Employee's employment with IIS except
                  (i) pursuant to applicable laws or regulations, including the
                  rules and regulations of the SEC, (ii) to effectuate the
                  provisions of employee plans or programs or insurance
                  policies, (iii) with the specific written consent of the
                  other; or (iv) as may be otherwise contemplated by this
                  Agreement. This restriction shall apply to any such statement,
                  written or oral, direct or indirect, voluntarily made.

Section 10.       Governing Law and Jurisdiction. This Agreement shall be
-----------       -------------------------------
                  governed by and construed in accordance with the laws of the
                  State of Arizona. Both parties hereby irrevocably submit to
                  the exclusive jurisdiction of any federal or


<PAGE>

                  state court in Maricopa County, State of Arizona, for any
                  lawsuit, action or proceeding arising out of or relating to
                  this Agreement, and the parties irrevocably agree that all
                  claims in respect of such lawsuit, action or proceeding may be
                  heard and determined in such court.

Section 11.       Saving Clause. If any provision of this Agreement is invalid
-----------       --------------
                  under applicable law, such provision shall be deemed to
                  be not a part of this Agreement, but shall not invalidate any
                  other provision.
<TABLE>
<CAPTION>
<S>                                                    <C>
"EMPLOYEE"                                           "IIS"

David Wirthlin                                       INTEGRATED INFORMATION SYSTEMS,
                                                     INC., a Delaware corporation

            /s/ David Wirthlin                       By            /s/ Jill Clark
--------------------------------------------            ----------------------------------------

Date:     10-11-01                                   Title:         Director, HR
      --------------------------------------               -------------------------------------
Final Date for revocation:  10-18-01
                           -----------------
(7 days after date of Agreement)                     Date:            10-11-01
                                                           -------------------------------------
</TABLE>

<PAGE>

                                 NON-REVOCATION
                        AS OF THE DATE SHOWN ON THIS FORM

          By signing below, I hereby verify that I have chosen not to revoke my
agreement to and execution of the Separation and General Release Agreement. My
signature confirms my renewed agreement to the terms of that Agreement,
including the release and waiver of any and all claims relating to my employment
with the Employer and/or the termination of that employment.

DAVID WIRTHLIN ("EMPLOYEE")


         /s/ David Wirthlin                                 10-18-01
---------------------------------               --------------------------------
Employee Signature*                             Date*

* Do not sign, date or return this document until seven (7) days after you sign
the Separation Agreement and Release General Release.