Login with a URL variable

Hi Guys,

I’m quiet new to WP, and trying to figure out how to do this:

Basically i need to integrate another sites login mechanism with WP so when someone logs to the other site he doesn’t have to login to WP again.

So how it works is, i setup a simple login form on WP and pass the username and pass to a script in the second site (its actually in the same domain, like mini site). And the script takes those details and verifies them against its database and if details are correct will redirect to a URL to the WP site with a flag URL variable to say user is logged.

What i want to do is, if the URL has the flag to set a cookie in WP and show several extra links in the header and maybe give access to some extra pages within WP.

And again when the user wants to logout have a link to the second site which will logout and again redirect to WP with a Flag to say to WP to clear to cookie.

Can anyone give me an idea on how to do this?

Thanks