Table of Contents

						Page No.
Article I THE MERGER							1
		1.1		The Merger			1
		1.2		Effective Time; Closing			2
		1.3		Effect of the Merger			2
		1.4		Certificate of Incorporation and Bylaws			2
		1.5		Directors and Officers			2
		1.6		Effect on Capital Stock			3
		1.7		Surrender of Certificates			5
		1.8		No Further Ownership Rights in Company Common Stock			7
		1.9		Lost, Stolen or Destroyed Certificates			7
		1.10		Amendment to Agreement			8
		1.11		Further Action			8
Article II REPRESENTATIONS AND WARRANTIES OF THE COMPANY							8
		2.1		Organization; Standing and Power; Charter Documents; Subsidiaries			8
		2.2		Capital Structure			9
		2.3		Authority; No Conflict; Necessary Consents			11
		2.4		SEC Filings; Financial Statements; Internal Controls			13
		2.5		Absence of Certain Changes or Events			15
		2.6		Taxes			18
		2.7		Title to Properties			20
		2.8		Intellectual Property			22
		2.9		Restrictions on Business Activities			26
		2.10		Governmental Authorizations			27
		2.11		Litigation			27
		2.12		Compliance with Law			27
		2.13		Environmental Matters			28
		2.14		Brokers and Finders Fees			29
		2.15		Transactions with Affiliates			29
		2.16		Employee Benefit Plans and Compensation			29
		2.17		Contracts			35
		2.18		Insurance			36
		2.19		Customers and Suppliers			37
		2.20		Foreign Corrupt Practices Act			37
		2.21		Information in Registration Statement and Prospectus/Proxy Statement			38
		2.22		Fairness Opinion			38
		2.23		Takeover Statutes and Rights Plans			38
Article III REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER SUB							39
		3.1		Organization			39
		3.2		Authority; No Conflict; Necessary Consents			39
		3.3		Capital Structure			40
		3.4		Information in Registration Statement and Prospectus/Proxy Statement			40

						Page No.
		3.5		SEC Filings; Financial Statements			41
		3.6		Brokers and Finders Fees			43
		3.7		Interim Operations of Merger Sub			43
		3.8		Foreign Corrupt Practices Act			43
		3.9		Legal Proceedings			43
Article IV CONDUCT BY THE COMPANY PRIOR TO THE EFFECTIVE TIME							43
		4.1		Conduct of Business by the Company			43
Article V ADDITIONAL AGREEMENTS							46
		5.1		Prospectus/Proxy Statement; Registration Statement			46
		5.2		Meeting of Company Stockholders; Board Recommendation			47
		5.3		Acquisition Proposals			48
		5.4		Confidentiality; Access to Information; No Modification of Representations, Warranties or Covenants			52
		5.5		Public Disclosure			53
		5.6		Regulatory Filings; Reasonable Efforts			53
		5.7		Notification of Certain Matters			55
		5.8		Third-Party Consents			55
		5.9		Equity Awards and Employee Matters			56
		5.10		Indemnification			57
		5.11		Section 16 Matters			58
		5.12		Tax Matters			58
		5.13		145 Affiliates			59
Article VI CONDITIONS TO THE MERGER							59
		6.1		Conditions to the Obligations of Each Party to Effect the Merger			59
		6.2		Additional Conditions to the Obligations of Parent			60
		6.3		Additional Conditions to the Obligations of the Company			60
Article VII TERMINATION, AMENDMENT AND WAIVER							61
		7.1		Termination			61
		7.2		Notice of Termination; Effect of Termination			64
		7.3		Fees and Expenses			64
		7.4		Amendment			65
		7.5		Extension; Waiver			65
Article VIII GENERAL PROVISIONS							66
		8.1		Non-Survival of Representations and Warranties			66
		8.2		Notices			66
		8.3		Interpretation; Knowledge			67
		8.4		Counterparts			68
		8.5		Entire Agreement; Third-Party Beneficiaries			68
		8.6		Severability			69
		8.7		Other Remedies; Specific Performance			69
		8.8		Governing Law			69

						Page No.
		8.9		Rules of Construction			69
		8.10		Assignment			70
		8.11		Waiver of Jury Trial			70
Exhibit A				Form of Voting Agreement			A-1
Exhibit B				Form of Affiliate Agreement			B-1

INDEX OF DEFINED TERMS

Defined Term		Section
401(k) Plan		5.9(d)
Acquisition		7.3(b)(iv)
Acquisition Proposal		5.3(h)(i)
Action of Divestiture		5.6(d)
Agreement		Preamble
Audit		2.6(a)
Average Parent Share Price		1.6(a)
Business Day		1.2
Certificate of Merger		1.2
Certificates		1.7(c)
Change of Recommendation		5.3(d)
Change of Recommendation Notice		5.3(d)(iii)
Closing		1.2
Closing Date		1.2
COBRA		2.16(a)
Code		Recitals
Company		Preamble
Company Balance Sheet		2.4(b)
Company Charter Documents		2.1(b)
Company Common Stock		1.6(a)
Company Disclosure Schedule		Article II
Company Employee Plan		2.16(a)
Company Financials		2.4(b)
Company Intellectual Property		2.8
Company Material Contract		2.17(a)
Company Options		2.2(b)
Company Preferred Stock		2.2(a)
Company Products		2.8
Company Registered Intellectual Property		2.8
Company SEC Reports		2.4(a)
Company Significant Customer		2.19(a)
Confidentiality Agreements		5.4(a)
Contaminants		2.8(j)
Continuing Employees		5.9(e)
Contract		2.1(a)
Delaware Law		1.1
Deutsche Bank		2.14
DOJ		2.3(d)
DOL		2.16(a)
Effect		8.3(d)
Effective Time		1.2
Employee/Service Provider		2.16(a)
Employee Agreement		2.16(a)

Defined Term		Section
End Date		7.1(b)
Environmental Claim		2.13(a)
Environmental Laws		2.13(a)
ERISA		2.16(a)
ERISA Affiliate		2.16(a)
Exchange Act		2.3(d)
Exchange Agent		1.7(a)
Exchange Fund		1.7(b)
Exchange Ratio		1.6(a)
FCPA		2.20
FTC		2.3(d)
GAAP		2.4(b)
Governmental Authorizations		2.10
Governmental Entity		2.3(d)
HSR Act		2.3(d)
HIPAA		2.16(a)
Include, Includes, Including		8.3(a)
Indemnified Parties		5.10(a)
Intellectual Property		2.8
Intellectual Property Contracts		2.8(a)
Intellectual Property Rights		2.8
International Employee Plan		2.16(a)
IRS		2.16(a)
Knowledge		8.3(b)
Lease Documents		2.7(b)
Leased Real Property		2.7(a)
Legal Requirements		1.7(f)
Liens		2.1(c)
Made Available		8.3(c)
Material Adverse Effect		8.3(d)
Materials of Environmental Concern		2.13(a)
Measurement End Date		1.6(a)
Merger Sub		Preamble
Merger Sub Charter Documents		3.1
Merger Sub Common Stock		1.6(d)
Merger		1.1
Necessary Consents		2.3(d)
Open Source		2.8
Option Plans		2.2(b)
Parent		Preamble
Parent Benefit Plan		5.9(e)
Parent Charter Documents		3.1
Parent Ordinary Shares		1.6(a)
Parent Disclosure Schedule		Article III
Parent Financials		3.5(b)

Defined Term		Section
Parent Options		3.3(a)
Parent SEC Reports		3.5(a)
Parents 401(k) Plan		5.9(d)
Pension Plan		2.16(a)
Per Share Merger Consideration		1.6(e)
Permitted Liens		2.7(c)
Person		8.3(e)
Prospectus/Proxy Statement		2.21
Registration Statement		2.21
SEC		2.3(d)
Securities Act		2.4(a)
Shrink-Wrapped Code		2.8
Significant Subsidiary		2.1(b)
Significant Supplier		2.19(b)
Source Code		2.8
Stockholders Meeting		5.2(a)
Subsidiary		2.1(a)
Subsidiary Charter Documents		2.1(b)
Superior Offer		5.3(h)(ii)
Surviving Corporation		1.1
Tax		2.6(a)
Tax Authority		2.6(a)
Tax Opinions		5.12
Tax Returns		2.6(a)
Taxes		2.6(a)
Termination Fee		7.3(b)(i)
Top-up Notice		1.6(a)
Trade Secret		2.8
Triggering Event		7.1
Voting Agreements		Recitals
Voting Debt		2.2(c)
Walk-Away Notice		1.6(a)
Walk-Away Price		1.6(a)
WARN		2.16(a)

AGREEMENT AND PLAN OF MERGER

     This AGREEMENT AND PLAN OF MERGER (this Agreement) is made and entered into as of September 4, 2006, by and among Flextronics International Ltd., a Singapore company (Parent), Granite Acquisition Corp., a Delaware corporation and wholly-owned subsidiary of Parent (Merger Sub), and International DisplayWorks, Inc., a Delaware corporation (the Company).

RECITALS

     A. The respective Boards of Directors of Parent, Merger Sub and the Company have deemed it advisable and in the best interests of their respective companies and stockholders that Parent and the Company consummate the business combination and other transactions provided for herein.

     B. Concurrently with the execution of this Agreement, and as a condition and inducement to Parents willingness to enter into this Agreement, all current executive officers and members of the Board of Directors of the Company are entering into Voting Agreements and irrevocable proxies in substantially the form attached hereto as Exhibit A (the Voting Agreements).

     C. The Board of Directors of the Company has resolved to recommend to its stockholders the adoption and approval of this Agreement and the approval of the Merger.

     D. Parent, as the sole stockholder of Merger Sub, has approved and adopted this Agreement and approved the Merger.

     E. Parent, Merger Sub and the Company each desire to make certain representations, warranties, covenants and agreements in connection with the Merger and also to prescribe certain conditions to the Merger.

     F. For United States federal income tax purposes, the parties intend that the Merger qualify as a reorganization under the provisions of Section 368(a) of the Internal Revenue Code of 1986, as amended, and the rules and regulations promulgated thereunder (the Code), and this Agreement will be, and hereby is, adopted as a plan of reorganization for purposes of Section 368(a) of the Code.

     NOW, THEREFORE, in consideration of the covenants, promises and representations set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties, intending to be legally bound, do hereby agree as follows:

ARTICLE I
THE MERGER

     1.1 The Merger. At the Effective Time and subject to and upon the terms and conditions of this Agreement and the applicable provisions of the Delaware General Corporation

Law (Delaware Law), Merger Sub shall be merged with and into the Company (the Merger), the separate corporate existence of Merger Sub shall cease and the Company shall continue as the surviving corporation and as a wholly-owned subsidiary of Parent. The surviving corporation after the Merger is hereinafter sometimes referred to as the Surviving Corporation.

     1.2 Effective Time; Closing. Subject to the provisions of this Agreement, the parties hereto shall cause the Merger to be consummated by filing a Certificate of Merger with the Secretary of State of the State of Delaware in accordance with the relevant provisions of Delaware Law (the Certificate of Merger) (the time of such filing with the Secretary of State of the State of Delaware (or such later time as may be agreed in writing by the Company and Parent and specified in the Certificate of Merger) being the Effective Time) as soon as practicable on the Closing Date. The closing of the Merger (the Closing) shall take place at the offices of Curtis, Mallet-Prevost, Colt & Mosle LLP, located at 101 Park Avenue, New York, New York, or such other place as agreed to by the parties, at a time and date to be specified by the parties, which shall be no later than the third Business Day after the satisfaction or waiver of the conditions set forth in Article VI (other than those that by their terms are to be satisfied or waived at the Closing), or at such other time, date and location as the parties hereto agree in writing. The date on which the Closing occurs is referred to herein as the Closing Date. Business Day shall mean each day that is not a Saturday, Sunday or other day on which banking institutions located in San Jose, California are authorized or obligated by law or executive order to close.

     1.3 Effect of the Merger. At the Effective Time, the effect of the Merger shall be as provided in this Agreement, the Certificate of Merger and the applicable provisions of Delaware Law. Without limiting the generality of the foregoing, and subject thereto, at the Effective Time all the property, rights, privileges, powers and franchises of Company and Merger Sub shall vest in the Surviving Corporation, and all debts, liabilities and duties of Company and Merger Sub shall become the debts, liabilities and duties of the Surviving Corporation.

     1.4 Certificate of Incorporation and Bylaws. At the Effective Time, the certificate of incorporation of the Company shall be amended and restated in its entirety to be identical to the certificate of incorporation of Merger Sub, as in effect immediately prior to the Effective Time, until thereafter amended in accordance with Delaware Law and as provided in such certificate of incorporation; provided, however, that at the Effective Time, Article I of the certificate of incorporation of the Surviving Corporation shall be amended and restated in its entirety to read as follows: The name of the corporation is International DisplayWorks, Inc. At the Effective Time, the bylaws of the Company shall be amended and restated in their entirety to be identical to the bylaws of Merger Sub, as in effect immediately prior to the Effective Time, until thereafter amended in accordance with Delaware Law and as provided in such bylaws.

     1.5 Directors and Officers. The initial directors of the Surviving Corporation shall be the directors of Merger Sub immediately prior to the Effective Time, until their respective successors are duly elected or appointed and qualified. The initial officers of the Surviving Corporation shall be the officers of Merger Sub immediately prior to the Effective Time, until their respective successors are duly appointed. In addition, unless otherwise determined by Parent prior to the Effective Time, Parent, the Company and the Surviving Corporation shall take