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                                                                    EXHIBIT 10.1


                              SEPARATION AGREEMENT

This Separation Agreement ("Agreement") is entered into by mutual agreement by
and between BindView Development Corporation ("BindView" or "Company") and DAVID
S. FLAME ("Executive") in connection with the Executive's resignation. This
Agreement amends (i) the Executive Employment Agreement between the Executive
and the Company ("Employment Agreement"); (ii) the Change of Control Agreement
between the Executive and the Company; and (iii) any stock or stock option
agreement(s), if any ("Stock Agreement(s)"); between the Executive and the
Company. In the case of any inconsistencies or conflict between any of those
agreements on the one hand and this Agreement on the other hand, the terms of
this Agreement shall govern. Such agreements otherwise remain in effect in
accordance with their terms.

1.  The parties agree that:

    a.  The Executive will resign voluntarily, in furtherance of the parties'
        mutual interests, effective November 2, 2004, with his last day of
        employment being the same date.

    b.  For purposes of the Employment Agreement and the Change of Control
        Agreement, such resignation will be treated as though the Executive had
        Resigned for Good Reason effective November 2, 2004 and will receive the
        severance benefits specified in those agreements.

    c.  The Executive will be paid a sales commission, computed and paid as set
        forth in subparagraph 1(d) below, and subject to the exclusion in
        subparagraph 1(e) below, for each sale by the Company that meets all of
        the following conditions:

           i.    the sale is in a territory for which the Executive would have
                 been paid commissions had he remained in his position as the
                 Company's vice president, Americas sales and field operations
                 through December 31, 2004;

           ii.   the sales process for such specific sale was initiated on or
                 before November 1, 2004 as shown by the Company's records;

           iii.  the sale is closed on or before December 31, 2004.

    d.  The sales commissions referred to in subparagraph 1(c) shall be based on
        the revenues recorded in the Company's books and records in accordance
        with generally accepted accounting principles consistently applied, as
        certified by the regular annual audit of the Company's financial
        statements. Such commissions will be paid within ten (10) business days
        after the Company files its Annual Report on Form 10-K for the fiscal
        year ending December 31, 2004, subject to the same terms and conditions
        as if the Executive had remained in his position as the Company's vice
        president, Americas sales and field operations.

    e.  Notwithstanding subparagraphs 1(c) and 1(d), the Executive will not be
        entitled to commissions on any revenues from professional services in
        connection with the preparation and/or production of video-based
        training materials.

    f.  This subparagraph addresses variable compensation to which the Executive
        would have been entitled if he had achieved certain management
        objectives ("MBOs") previously set by the Company as a target for the
        Executive to attempt to achieve in the year 2004. If the Company
        determines that such MBO(s) had been achieved by the Executive on an
        interim basis as of

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        October 31, 2004, then the Company will pay the Executive ten twelfths
        (10/12) of the amount to which the Executive would have been entitled
        had he remained in his position at the Company through December 31,
        2004. Payment of any such variable compensation will be due five
        business days after the execution of this Agreement.

    g.  Section 6.1 of the Employment Agreement (noncompetition covenant) is
        amended so that the one-year period referred to therein is reduced to
        nine (9) months.

2.  As a material condition of receiving the severance benefits described in
    paragraph 1 above:

    a.  the Executive represents that to the best of his knowledge, he has not
        participated or been involved in any improper practices that would
        warrant termination of an employee for cause; and

    b.  the Executive agrees to cooperate fully with the Company and its counsel
        in (i) the investigation, by the Company's Audit Committee, of certain
        of the Company's transactions in Latin America referred to in the
        Company's press release dated October 28, 2004; (ii) any other
        investigation by the Company or its Board of Directors or any committee
        thereof; and (iii) any administrative or legal proceedings that may
        arise in respect thereto. In connection therewith, the Company will
        reimburse the Executive, in accordance with the Company's standard
        reimbursement policies, for all reasonable expenses, if any, that the
        Executive may incur at the request of the Company.

3.  The Executive will be entitled to payment of unpaid amounts due for salary,
    expense reimbursement, pay in lieu of unused vacation, and any other unpaid
    amounts due, in accordance with Section 5.7 of the Employment Agreement. The
    Executive shall also be entitled to exercise his stock options that are
    vested but unexercised as of his last day of employment in accordance with
    the procedures set forth in the applicable Stock Agreement(s).

4.  Subject to but without limiting paragraphs 1(c) and 1(f) above, any
    commissions or other variable compensation earned by the Executive in any
    period ending on or before October 31, 2004, that were not previously paid
    as of the date of this Agreement, will be paid at the later of (i) the time
    called for by the applicable compensation plan as though the Executive were
    not resigning, or (ii) five business days after the execution of this
    Agreement.

5.  Except as set forth in this Agreement, the Executive shall not be entitled
    to any further compensation, benefits, or reimbursement of any kind from the
    Company, including but not limited to salary, commissions, vacation accrual,
    insurance coverage, stock option vesting rights (including but not limited
    to accelerated vesting) or exercise rights (including but not limited to
    extended periods of time to exercise vested options), severance payments, or
    other compensation or benefits.

6.  Neither the Company nor the Executive shall make any false or misleading
    statement concerning the other in any public statement or comment, nor shall
    the Company do so in its internal communications. The Company will refer all
    requests for references concerning the Executive (e.g., from recruiters or
    prospective employers) to the Company's chief executive officer.

7.  The Executive acknowledges that he continues to be bound by the Employment
    Agreement, without limitation, Sections 8 (confidentiality), Section 9
    (intellectual property), and Section 10 (noncompetition covenant) thereof,
    which are also incorporated into this Agreement by reference as though fully
    set forth herein.

                                                                     PAGE 2 OF 3
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8.  Sections 12 (arbitration) and 13 (general provisions) of the Employment
    Agreement are incorporated into this Agreement by reference as though fully
    set forth herein.

9.  The Executive is contemporaneously executing a release substantially in the
    form set forth as an exhibit to the Employment Agreement. Such release is
    subject to the terms and conditions stated therein, including but not
    limited to the Executive's right to consider the release before executing it
    and his right to revoke the release during a stated period of time. If the
    Executive duly revokes such release in accordance with the terms and
    conditions set forth therein, this Agreement shall be rescinded and shall be
    of no force or effect.

THIS AGREEMENT CONTAINS PROVISIONS REQUIRING BINDING ARBITRATION OF DISPUTES,
WHICH HAVE THE EFFECT OF WAIVING EACH PARTY'S RIGHT TO A JURY TRIAL. By signing
this Agreement, the Executive acknowledges that the Executive (1) has read and
understood the entire Agreement; (2) has received a copy of it (3) has had the
opportunity to ask questions and consult counsel or other advisors about its
terms; and (4) agrees to be bound by it.


EXECUTED the dates written below, to be effective November 2, 2004.

<Table>
<S>                                                              <C>
AGREED:                                                          AGREED:
BINDVIEW DEVELOPMENT CORPORATION, by:

/s/ Eric J. Pulaski                                              /s/ David S. Flame
------------------------------                                   ------------------------------
Eric J. Pulaski, Chairman and                                    David S. Flame
Chief Executive Officer


November 3, 2004                                                 November 3, 2004
------------------------------                                   ------------------------------
Date signed                                                      Date signed
</Table>


STATE OF TEXAS

ON NOVEMBER 3, 2004, personally appeared before me, the undersigned Notary
Public for the State of Texas, DAVID S. FLAME, known to me or identified by
sufficient evidence, who acknowledged that he had executed the foregoing
instrument for the purposes and consideration therein stated.

Date:  Nov. 3, 2004                        /s/ Teresa Y. Fish
                                           -------------------------------------
                                           Teresa Y. Fish
                                           My commission expires:  Feb. 10, 2005

ON NOVEMBER 3, 2004, personally appeared before me, the undersigned Notary
Public for the State of Texas, ERIC J. PULASKI, Chairman and Chief Executive
Officer of BindView Development Corporation, known to me or identified by
sufficient evidence, who acknowledged that he had executed the foregoing
instrument in the capacity and for the purposes and consideration therein
stated.

Date:  Nov. 3, 2004                        /s/ Teresa Y. Fish
                                           -------------------------------------
                                           Teresa Y. Fish
                                           My commission expires:  Feb. 10, 2005


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