Integrated Information Systems Acquires Certain Assets and the Management and Professional Staff of K2 Digital -- An Established New York City Digital Services Firm.

Business Editors/Technology Writers

TEMPE, Ariz.--(BUSINESS WIRE)--Aug. 30, 2001

Integrated Information Systems, Inc. ("IIS") (Nasdaq:IISX), an innovative technology and business consultancy, today announced that it has hired the executive management and professional staff and acquired certain related assets of K2 Digital, Inc. (OTC:KTWO.OB), a premiere digital services company based in New York City.

The K2 Digital professionals will continue to service clients under the K2 Digital name from the same New York location.

K2 Digital provides comprehensive, integrated digital professional services, including strategic consulting, design and development of digital channels, online quantitative and usability research, and online marketing. Ranked among the fastest growing technology companies in both 1999 and 2000 by Deloitte & Touche, K2 Digital's clients include ABB, Bristol-Myers Squibb, ING Aetna Financial Services, Morgan Stanley, Preferred Hotels & Resorts, Silversea Cruises and WorldCom. K2 Digital has also formed key partnerships that include Microsoft, IBM, Interwoven, WebCriteria and Kana Communications. Using a process-driven approach, K2 Digital constructs user-centric digital channels to help multi-divisional and global companies maximize their Internet opportunities.

"The combination of K2 Digital's strategy and interactive design skills with IIS' heavy-lifting back-end application development, integration, application outsourcing and off-shore development capabilities offers clients a cost-effective, end-to-end provider for all aspects of their business model," said Lynn Fantom, formerly President and Chief Executive Officer of K2 Digital, Inc., and now General Manager, K2 Digital division, of IIS. "Whether developing innovative Internet, intranet or extranet solutions, clients are assured single-source accountability for the entire project from strategy, design, application development, integration and ongoing operations. Our professionals are pleased to offer current and new clients these complementary services."

These transactions broaden and strengthen IIS' expertise in digital strategic planning and interactive design, furthering IIS' single-source service delivery model with seamless integration between strategy, system integration and operations. K2 Digital's proprietary W3 Organizational Modeling(TM) methodology provides innovative strategic direction to its Fortune 1000 clientele through a proven framework to analyze, design, build, and maintain digital solutions that are fully responsive to business needs. K2 Digital's comprehensive W3 systematic framework augments IIS' present methodology, NextDimension(SM). The unified methodology, branded under the W3 trademark, provides a superior foundation upon which clients can align enterprise-wide objectives, quantifiable success metrics and advanced technology solutions.

"This highly strategic move, coming after K2 Digital and IIS have each undergone significant cost reduction measures, can provide positive operational synergies as well as new revenue opportunities. It further enhances our ability to provide clients with the most advanced insights on the extensive use of technology and the realization of such solutions in their business performance," said Jim Garvey, Chairman, Chief Executive Officer and President of IIS. "We have substantial vertical market expertise in common, and K2 Digital's successes with Fortune 1000 clients in financial services, healthcare and hospitality further enhance our joint delivery capabilities."

Founded in 1993, K2 Digital was established by professionals from well-respected electronic publishing, brand advertising and communications firms to leverage their traditional communication and strategy skills in the rapidly evolving digital world. Over the years, K2 Digital helped pioneer numerous technological innovations, including:

-- The first synchronized in-store kiosk and website (1995);

-- The first commercially successful Web simulcast -- Kasparov vs. IBM's Deep
Blue (1996);

-- The first agency to create a data-capture Java banner (1998); and

-- The first commercially available customer support desktop application
utilizing non-proprietary XML-based content and a 3-D imaging engine (2000).

K2 Digital's combination of digital and traditional off-line experience has also resulted in industry recognition and numerous design awards, including: International Web Page Awards for CertcoRMX (2001), Bayer Aspirin (1999) and Lexis Nexis (1999); Outstanding Web Site by the Web Marketing Association for Worldcom site (www.wcom.com) (2000); Gold NewMedia INVISION Award in the Travel category for its Meet Puerto Rico site (www.meetpuertorico.com) (1999); and K2 Digital's campaign for Sony Online Entertainment received the MC Icon Silver Award for Creative Excellence for Technology Marketers (1999).

For more information, please visit the K2 Digital web site at www.k2digital.com.

About IIS

Integrated Information Systems(TM) is an innovative technology and business consultancy providing extensive experience and insight to create a sustainable competitive edge for clients. For companies who seek measurable results from business and technology investments, IIS offers cost-conscious, productive, profit-minded solutions across the entire service value chain with single provider accountability.

Founded in 1988, IIS employs approximately 318 professionals in offices in Atlanta, Boston, Denver, Jacksonville, Las Vegas, Los Angeles, New York City, Phoenix, San Francisco and Bangalore, India.

For more information, please visit the IIS web site at www.iis.com.

Cautionary Statement

This press release contains forward-looking statements as that term is defined under the Private Securities Litigation Reform Act of 1995, including statements concerning IIS' ability to continue serving K2 Digital's clients and to profitably integrate the capabilities of K2's professional consulting staff with the services offered by IIS, as well as IIS' ability to deliver advanced solutions for its clients and to create demand for its services. These forward-looking statements involve a number of risks and uncertainties which could cause actual events to differ materially from those expressed by such forward-looking statements and could cause the company's stock price to decline. Factors that could cause actual events to differ from such forward-looking statements include the inability to retain and continue to serve K2 Digital's clients, the inability to coordinate and integrate the capabilities of K2's professional staff with the services offered by IIS, the inability of IIS to retain K2's former consulting staff and executives, IIS' ability to generate sufficient revenues to offset the costs and expenses of the K2 transactions, and the incurrence of unexpected costs, expenses and liabilities by IIS resulting from the K2 transactions. Additional risks include lower demand for the company's services, reductions in pricing for the company's services, the company's inability to execute its business plan, obtain new clients or retain existing clients, the company's ability to attract, retain and effectively utilize its personnel, the potential loss of client projects, increased competition, the company's ability to maintain and enhance technology alliances, and its ability to stay at the forefront of technology changes, and other factors identified in documents filed by IIS with the Securities and Exchange Commission and in other public statements, including those set forth under the caption "Risk Factors" in the company's Form 10-K for the year ended December 31, 2000 and in its Form 10-Q for the quarter ended June 30, 2001. All forward-looking statements included in this document are made as of the date hereof, based on information available to IIS on the date hereof, and IIS assumes no obligation to update any forward-looking statements.