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                                                                    Exhibit 10.4


                               GUARANTY AGREEMENT


         THIS GUARANTY AGREEMENT (this "Guaranty Agreement") dated as of
December 14, 1998 is made by FORE SYSTEMS HOLDING CORPORATION, a Delaware
corporation (the "Guarantor"), in favor of MELLON BANK, N.A., as Construction
Lender (together with the various financial institutions which may from time to
time become lenders under the Construction Loan Agreement referred to below, and
in the event of a Refinancing, the Tranche A Lenders and the Tranche B Lender,
collectively, the "Lender") and MELLON FINANCIAL SERVICES CORPORATION #4, as
Certificate Purchaser (together with its successors and assigns in such
capacity, the "Certificate Purchaser"; the Lender and the Certificate Purchaser
are referred to collectively as the "Funding Parties" and individually as a
"Funding Party").

                              W I T N E S S E T H:
                              --------------------

         WHEREAS, pursuant to a Construction Loan Agreement, dated as of the
date hereof (together with all amendments, restatements and other modifications,
if any, from time to time hereafter made thereto, the "Loan Agreement"), between
Wilmington Trust Company, not in its individual capacity except as expressly
stated therein, but solely as Certificate Trustee and the Construction Lender,
the Construction Lender has agreed, subject to the terms and conditions thereof,
to make Loans to the Certificate Trustee;

         WHEREAS, pursuant to the terms of a Trust Agreement, dated as of the
date hereof (together with all amendments, restatements and other modifications,
if any, from time to time hereafter made thereto, the "Trust Agreement"),
between Wilmington Trust Company, not in its individual capacity except as
expressly stated therein, but solely as Certificate Trustee and the Certificate
Purchaser, the Certificate Purchaser has agreed to purchase the Certificate;

         WHEREAS, as a condition to the occurrence of the Documentation Date
under the Participation Agreement, dated as of the date hereof (together with
all amendments, restatements and other modifications, if any, from time to time
hereafter made thereto, the "Participation Agreement"), among Fore Systems, Inc.
("Fore"), the Certificate Trustee, the Certificate Purchaser, and the
Construction Lender, the Guarantor is required to execute and deliver this
Guaranty Agreement in favor of the Funding Parties;

         WHEREAS, the Guarantor has duly authorized the execution, delivery and
performance of this Guaranty Agreement; and

         WHEREAS, it is in the best interests of the Guarantor to execute this
Guaranty Agreement inasmuch as the Guarantor will derive substantial benefits
from the transactions contemplated by the Loan Agreement, the Trust Agreement
and the Participation Agreement;


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         NOW, THEREFORE, for good and valuable consideration the receipt of
which is hereby acknowledged, and in order to induce the Construction Lender to
enter into the Loan Agreement and the Certificate Purchaser to purchase the
Certificate, and intending to be legally bound hereby, the Guarantor agrees, for
the benefit of the Funding Parties, as follows:

                                    ARTICLE I

                                   DEFINITIONS

         SECTION 1.1. Certain Terms. The following terms (whether or not 
underscored) when used in this Guaranty Agreement, including its preamble and 
recitals, shall have the following meanings (such definitions to be equally 
applicable to the singular and plural forms thereof):

         "Guarantor" is defined in the preamble.

         "Guaranty Agreement" is defined in the preamble.

         "Holder" shall mean any assignee or transferee of an Interest which is
assigned or otherwise transferred (in accordance with Section 12.1 of the
Participation Agreement to the extent that Section 12.1 is applicable to such
transfer).

         "Interest" shall mean all or any of the right, title, or interest and
obligations of any Funding Party or any Holder in and to the Loan Agreement or
the other Operative Documents, and in the event of a Refinancing, the
Refinancing Loan Documents, all or any of the benefits, advantages and
obligations of any Funding Party or any Holder under the Loan Agreement or the
other Operative Documents, and in the event of a Refinancing, the Refinancing
Loan Documents, and all or any right, title and interest of any Funding Party or
any Holder in and to the Property.

         "Lender" is defined in the preamble.

         "Lessee" means Fore, in its capacity as Lessee under the Participation
Agreement and the Lease.

         "Loan Agreement" is defined in the first recital.

         "Obligations" means all of the following, in each case howsoever
created, arising or evidenced, whether direct or indirect, joint or several,
absolute or contingent, or now or hereafter existing, or due or to become due:
all principal of the Note, interest accrued thereon, the Certificate Amount,
Certificate Yield accrued thereon and all additional amounts and other sums at
any time due and owing, and required to be paid, to the Participants by the
Certificate Trustee under the terms of the Loan Agreement, the Note or any other
Operative Documents and, in the event of a Refinancing, to the Tranche A Lenders
and the Tranche B Lender under any Refinancing Loan Document (including, without
limitation, Section 2.6 of the Construction Loan Agreement); provided, however, 
except for the representations and warranties of Guarantor provided herein, the 
liability of the Guarantor hereunder shall be strictly limited to the amount of 


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                                                              Guaranty Agreement
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the collateral required to be pledged by the Guarantor under the Pledge and
Security Agreement from time to time; provided further, that prior to the
commencement of the Base Term, the aggregate amount payable by the Guarantor
hereunder and the Lessee under the Guaranty with respect to a Construction
Agency Event of Default arising solely from an Unrelated Event shall be subject
to the limitations on recourse liability applicable to the Lessee set forth in
Section 13.1B.(2) of the Participation Agreement; and provided further, that
with respect to an exercise of the Remarketing Option pursuant to Section 20.1
of the Lease, the amount guaranteed under this Guaranty shall not exceed the
aggregate amounts Lessee is required to pay under the Lease and the other
Operative Documents.

         "Organic Document" means, relative to the Guarantor, its certificate of
incorporation, its by-laws and all shareholder agreements, voting trusts and
similar arrangements applicable to any of its authorized shares of capital
stock.

         "Participation Agreement" is defined in the third recital.

         "Trust Agreement" is defined in the second recital.

         "U.C.C." means the Uniform Commercial Code as in effect in the
Commonwealth of Pennsylvania.

         SECTION 1.2. Participation Agreement Definitions. Capitalized terms 
used but not otherwise defined in this Guaranty Agreement have the respective 
meanings specified in Appendix 1 to the Participation Agreement; and the rules 
of interpretation set forth in Appendix 1 to the Participation Agreement shall
apply to this Guaranty Agreement.

         SECTION 1.3. U.C.C. Definitions. Unless otherwise defined herein or the
context otherwise requires, terms for which meanings are provided in the U.C.C. 
are used in this Guaranty Agreement, including its preamble and recitals, with 
such meanings.

                                   ARTICLE II

                          GUARANTY AGREEMENT PROVISIONS

         SECTION 2.1. Guaranty Agreement. The Guarantor hereby absolutely, 
unconditionally and irrevocably

                  (a) guarantees the full and punctual payment when due (after
         giving effect to any applicable grace period), whether at stated
         maturity, by required prepayment, declaration, acceleration, demand or
         otherwise, of all Obligations, whether for principal, interest, fees,
         expenses or otherwise (including all such amounts which would become
         due but for the operation of the automatic stay under Section 362(a) of
         the United States Bankruptcy Code, 11 U.S.C. Section 362(a)), and the
         operation of Sections 502(b) and 506(b) of the United States Bankruptcy
         Code, 11 U.S.C. Section 502(b) and Section 506(b)), and


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                                                              Guaranty Agreement
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                  (b) indemnifies and holds harmless each Funding Party and each
         Holder for any and all costs and expenses (including reasonable
         attorney's fees and expenses) incurred by each Funding Party or such
         Holder, as the case may be, in enforcing any rights under this Guaranty
         Agreement.

This Guaranty Agreement constitutes a guaranty of payment when due and not of
collection, and the Guarantor specifically agrees that it shall not be necessary
or required that any Funding Party or any Holder exercise any right, assert any
claim or demand or enforce any remedy whatsoever against the Lessee (or any
other Person) before or as a condition to the obligations of the Guarantor
hereunder.

         SECTION 2.2. Guaranty Agreement Absolute, etc. This Guaranty Agreement
shall in all respects be a continuing, absolute, unconditional and irrevocable
guaranty of payment, and shall remain in full force and effect until all
Obligations have been paid in full, all obligations of the Guarantor hereunder
shall have been paid in full and all commitments of the Funding Parties under
the Loan Agreement and the other Operative Documents, and in the event of a
Refinancing, under the Refinancing Loan Documents, shall have terminated. The
Guarantor guarantees that the Obligations will be paid strictly in accordance
with the terms of the Loan Agreement and each other Operative Document, and in
the event of a Refinancing, each of the Refinancing Loan Documents, under which
they arise, regardless of any law, regulation or order now or hereafter in
effect in any jurisdiction affecting any of such terms or the rights of any
Funding Party or any Holder with respect thereto. The liability of the Guarantor
under this Guaranty Agreement shall be absolute, unconditional and irrevocable
irrespective of:

                  (a) any lack of validity, legality or enforceability of the
         Loan Agreement or any other Operative Document or Refinancing Loan
         Document;

                  (b) the failure of any Funding Party or any Holder

                           (i) to assert any claim or demand or to enforce any
                  right or remedy against the Certificate Trustee or any other 
                  Person (including any other guarantor) under the provisions  
                  of the Loan Agreement, any other Operative Document or 
                  Refinancing Loan Document or otherwise, or

                           (ii) to exercise any right or remedy against any
                  other guarantor of, or collateral securing, any Obligations;

                  (c) any change in the time, manner or place of payment of, or
         in any other term of, all or any of the Obligations, or any other
         extension, compromise or renewal of any Obligation;

                  (d) any reduction, limitation, impairment or termination of
         the Obligations for any reason, including any claim of waiver, release,
         surrender, alteration or compromise, and shall not be subject to (and
         the Guarantor hereby waives any right to or claim of) any defense or
         setoff, counterclaim, recoupment or termination whatsoever by reason of
         the 

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                                                              Guaranty Agreement
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         invalidity, illegality, nongenuineness, irregularity, compromise,
         unenforceability of, or any other event or occurrence affecting, the
         Obligations;

                  (e) any amendment to, rescission, waiver, or other
         modification of, or any consent to departure from, any of the terms of
         the Loan Agreement or any other Operative Document or Refinancing Loan
         Document;

                  (f) any addition, exchange, release, surrender or
         nonperfection of any collateral, or any amendment to or waiver or
         release or addition of, or consent to departure from, any other
         guaranty, held by any Funding Party or any Holder securing any of the
         Obligations; or

                  (g) any other circumstance which might otherwise constitute a
         defense available to, or a legal or equitable discharge of, the
         Certificate Trustee, any surety or any guarantor.

         SECTION 2.3. Reinstatement, etc. The Guarantor agrees that this
Guaranty Agreement shall continue to be effective or be reinstated, as the 
case may be, if at any time any payment (in whole or in part) of any of the
Obligations is rescinded or must otherwise be restored by any Funding Party or 
any Holder, upon the insolvency, bankruptcy or reorganization of Lessee, or
otherwise, as though such payment had not been made.

         SECTION 2.4. Waiver, etc. The Guarantor hereby waives promptness,
diligence, notice of acceptance and any other notice with respect to any of the
Obligations of the Lessee and this Guaranty Agreement and any requirement that
any Funding Party or any Holder protect, secure, perfect or insure any security
interest or Lien, or any property subject thereto, or exhaust any right or take
any action against the Certificate Trustee or any other Person (including any
other guarantor) or entity or any collateral securing the Obligations.

         SECTION 2.5. Waiver of Subrogation. The Guarantor hereby irrevocably
waives any claim or other rights which it may now or hereafter acquire against
the Certificate Trustee that arise from the existence, payment, performance or
enforcement of the Guarantor's obligations under this Guaranty Agreement or any
other Operative Document or Refinancing Loan Document, including any right of
subrogation, reimbursement, exoneration, or indemnification, any right to
participate in any claim or remedy of any Funding Party or any Holder against
the Lessee or any collateral which any Funding Party now has or hereafter
acquires, whether or not such claim, remedy or right arises in equity, or under
contract, statute or common law, including the right to take or receive from the
Certificate Trustee, directly or indirectly, in cash or other property or by
set-off or in any manner, payment or security on account of such claim or other
rights. If any amount shall be paid to the Guarantor in violation of the
preceding sentence and the Obligations shall not have been paid in cash in full
and all Commitments of the Funding Parties under the Loan Agreement and the
other Operative Documents, and in the event of a Refinancing, under the
Refinancing Loan Documents, have not been terminated, such amount shall be
deemed to have been paid to the Guarantor for the benefit of, and held in trust
for, the Funding Parties or 


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                                                              Guaranty Agreement
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any Holder or Holders, and shall forthwith be paid to the Funding Parties for
the benefit of the Funding Parties and any such Holder or Holders to be credited
and applied upon the Obligations, whether matured or unmatured. The Guarantor
acknowledges that it will receive benefits from the financing and other
arrangements contemplated by the Loan Agreement, the Trust Agreement, the
Participation Agreement and, in the event of a Refinancing, under the
Refinancing Loan Documents, and that the waiver set forth in this Section is
knowingly made in contemplation of such benefits.

         SECTION 2.6. Successors, Transferees and Assigns; Transfers of 
Interests, etc. This Guaranty Agreement shall:

                  (a) be binding upon the Guarantor and its successors,
         transferees and assigns; and

                  (b) inure to the benefit of and be enforceable by each Funding
         Party, each Holder and each of their respective successors.

Without limiting the generality of clause (b), any Lender and/or any Holder may,
in accordance with Section 12.1 of the Participation Agreement, and the
Certificate Purchaser and any Tranche A Lenders and the Tranche B Lender may,
assign or otherwise transfer (in whole or in part) any Interest held by it to
any Holder, and such Holder shall thereupon become vested with all rights and
benefits in respect thereof granted to the respective Funding Parties under any
Operative Document (including this Guaranty Agreement), Refinancing Document or
otherwise.

         SECTION 2.7. Consent to Jurisdiction; Waiver of Immunities. The 
Guarantor hereby acknowledges and agrees that:

                  (a) It irrevocably submits to the jurisdiction of any federal
         court sitting in Pennsylvania in any action or proceeding arising out
         of or relating to this Guaranty Agreement, and the Guarantor hereby
         irrevocably agrees that all claims in respect of such action or
         proceeding may be heard and determined in such federal court. The
         Guarantor hereby irrevocably waives, to the fullest extent it may
         effectively do so, the defense of an inconvenient forum to the
         maintenance of such action or proceeding. The Guarantor agrees that a
         final judgment in any such action or proceeding shall be conclusive and
         may be enforced in other jurisdictions by suit on the judgment or in
         any other manner provided by law.

                  (b) Nothing in this Section shall affect the right of any
         Funding Party or any Holder to serve legal process in any other manner
         permitted by law or affect the right of any Funding Party or any Holder
         to bring any action or proceeding against the Guarantor or its property
         in the courts of any other jurisdictions.


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                                                              Guaranty Agreement
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                                   ARTICLE III

                         REPRESENTATIONS AND WARRANTIES

         SECTION 3.1. Representations and Warranties. The Guarantor hereby 
represents and warrants to each Funding Party as set forth below:

                  (a) Corporate Status. The Guarantor (i) is a duly organized
         and validly existing corporation in good standing under the laws of the
         State of Delaware and (ii) has duly qualified and is authorized to do
         business and is in good standing in all jurisdictions where the failure
         to do so might have a material adverse effect on it or its properties.
         The Guarantor is and shall at all times remain a 100% wholly-owned
         subsidiary of the Lessee.

                  (b) Corporate Power and Authority. The Guarantor has the
         corporate power and authority to execute, deliver and carry out the
         terms and provisions of the Operative Documents to which it is or will
         be a party and has taken all necessary corporate action to authorize
         the execution, delivery and performance of the Operative Documents to
         which it is a party and has duly executed and delivered each Operative
         Document required to be executed and delivered by it and, assuming the
         due authorization, execution and delivery thereof on the part of each
         other party thereto, each such Operative Document constitutes a legal,
         valid and binding obligation enforceable against it in accordance with
         its terms, except as the same may be limited by insolvency, bankruptcy,
         reorganization or other laws relating to or affecting the enforcement
         of creditors' rights or by general equitable principles.

                  (c) No Violation. Neither the execution, delivery and
         performance by the Guarantor of the Operative Documents to which it is
         or will be a party nor compliance with the terms and provisions
         thereof, nor the consummation by the Guarantor of the transactions
         contemplated therein (i) result or will result in a violation by the
         Guarantor of any Applicable Law applicable to it or the Property, (ii)
         violate or result in any breach which would constitute a default under,
         or (other than pursuant to the Operative Documents) result in the
         creation or imposition of (or the obligation to create or impose) any
         Lien upon any of the property or assets of the Guarantor pursuant to
         the terms of any indenture, loan agreement or other agreement for
         borrowed money to which the Guarantor is a party or by which it or any
         of its property or assets is bound or to which it may be subject (other
         than Permitted Liens), or (iii) will violate any provision of the
         certificate of incorporation or by-laws of the Guarantor.

                  (d) Litigation. There are no actions, suits or proceedings
         pending or, to the knowledge of the Guarantor, threatened that question
         the validity of the Operative Documents or the rights or remedies of
         the Lessor, the Certificate Purchaser or the Construction Lender with
         respect to the Guarantor or the Property under the Operative Documents.

                  (e) Governmental Approvals. No Governmental Action by any
         Governmental 

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                                                              Guaranty Agreement
<PAGE>   8


         Authority having jurisdiction over the Guarantor or the Property is
         required to authorize or is required in connection with (i) the
         execution, delivery and performance by the Guarantor of any Operative
         Document to which it is a party and (ii) the legality, validity,
         binding effect or enforceability against the Guarantor of any Operative
         Document to which it is a party.

                  (f) Investment Company Act. The Guarantor is not an
         "investment company" or a company "controlled" by an "investment
         company," within the meaning of the Investment Company Act.

                  (g) Public Utility Holding Company Act. The Guarantor is not a
         "holding company" or a "subsidiary company", or an "affiliate" of a
         "holding company" or of a "subsidiary company" of a "holding company",
         within the meaning of the Public Utility Company Act of 1935, as
         amended.

                  (h) All United States Federal income tax returns and all other
         tax returns which are required to have been filed have been or will be
         filed by or on behalf of the Guarantor by the respective due dates,
         including extensions, and all taxes due with respect to the Guarantor
         pursuant to such returns or pursuant to any assessment received by the
         Guarantor have been or will be paid. The charges, accruals and reserves
         on the books of the Guarantor in respect of taxes or other governmental
         charges are, in the opinion of the Guarantor, adequate.

                  (i) Solvency. The Guarantor is Solvent.


                                   ARTICLE IV

                                    COVENANTS

         SECTION 4.1. Covenants. The Guarantor, so long as any portion of the
Obligations shall remain unpaid or any Funding Party shall have any outstanding
Commitments under the Loan Agreement or the other Operative Documents, or in the
event of a Refinancing, under any Refinancing Loan Document, covenants and
agrees as set forth below:

                  (a) Compliance with Laws. The Guarantor shall comply in all
         material respects with all Applicable Laws.

                  (b) Required Transfers. The Guarantor will maintain, or cause
         to be maintained, at all times throughout the Interim Term, the Base
         Term and any Renewal Term, Qualified Assets in the amounts, and
         transfer Qualified Assets in the amounts at the times and to the
         accounts, all as provided in the Pledge and Security Agreement.

                  (c) Payment of Taxes, Etc. The Guarantor shall pay and
         discharge before the 

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                                                              Guaranty Agreement
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         same shall become delinquent, (i) all taxes, assessments and
         governmental charges or levies imposed upon it or upon its property,
         and (ii) all lawful claims that, if unpaid, might by law become a Lien
         upon its property, other than those arising from Permitted Liens;

                                    ARTICLE V

                            MISCELLANEOUS PROVISIONS

         SECTION 5.1. Operative Document. This Guaranty Agreement is an 
Operative Document executed pursuant to the Loan Agreement and the Participation
Agreement.

         SECTION 5.2. Binding on Successors, Transferees and Assigns; Assignment
of Guaranty Agreement. In addition to, and not in limitation of, Section 2.6,
this Guaranty Agreement shall be binding upon the Guarantor and its successors,
transferees and assigns and shall inure to the benefit of and be enforceable by
each Funding Party and each Holder and their respective successors and assigns
(to the full extent provided pursuant to Section 2.6); provided, however, that
the Guarantor may not assign any of its obligations hereunder without the prior
written consent of each Funding Party and each Holder.

         SECTION 5.3. Amendments, etc. No amendment to or waiver of any
provision of this Guaranty Agreement, nor consent to any departure by the
Guarantor herefrom, shall in any event be effective unless the same shall be in
writing and signed by each Funding Party and each Holder, and then such waiver
or consent shall be effective only in the specific instance and for the specific
purpose for which given.

         SECTION 5.4. Addresses for Notices. All notices, demands, requests,
consents, approvals and other communications hereunder shall be in writing and
directed to the address described in, and deemed received in accordance with the
provisions of, Section 14.3 of the Participation Agreement.

         SECTION 5.5. No Waiver; Remedies. In addition to, and not in limitation
of, Section 2.2 and Section 2.4, no failure on the part of any Funding Party or
any Holder to exercise, and no delay in exercising, any right hereunder shall
operate as a waiver thereof; nor shall any single or partial exercise of any
right hereunder preclude any other or further exercise thereof or the exercise
of any other right. The remedies herein provided are cumulative and not
exclusive of any remedies provided by law.

         SECTION 5.6. Section Captions. Section captions used in this Guaranty
Agreement are for convenience of reference only, and shall not affect the
construction of this Guaranty Agreement.

         SECTION 5.7. Severability. Wherever possible each provision of this 
Guaranty Agreement shall be interpreted in such manner as to be effective and 
valid under applicable law, but if any provision of this Guaranty Agreement 
shall be prohibited by or invalid under such law, such provision shall be 
ineffective to the extent of such prohibition or invalidity, without



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                                                              Guaranty Agreement
<PAGE>   10
invalidating the remainder of such provision or the remaining provisions of this
Guaranty Agreement.

         SECTION 5.8. Termination of Guaranty Agreement. The Guarantor's
obligations under this Guaranty Agreement shall terminate on the date upon which
all Obligations are satisfied in full, subject to reinstatement as provided in
Section 2.3 hereof.

         SECTION 5.9. GOVERNING LAW. THIS GUARANTY AGREEMENT SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH LAWS OF THE COMMONWEALTH OF PENNSYLVANIA,
WITHOUT REGARD TO CONFLICTS OF LAW PROVISIONS. FOR PURPOSES OF ANY ACTION OR
PROCEEDING INVOLVING THIS GUARANTY AGREEMENT, THE GUARANTOR HEREBY EXPRESSLY
SUBMITS TO THE JURISDICTION OF ALL FEDERAL AND STATE COURTS LOCATED IN THE
COMMONWEALTH OF PENNSYLVANIA AND CONSENTS THAT IT MAY BE SERVED WITH ANY PROCESS
OR PAPER BY REGISTERED MAIL OR BY PERSONAL SERVICE WITHIN OR WITHOUT THE
COMMONWEALTH OF PENNSYLVANIA.

         SECTION 5.10. WAIVER OF JURY TRIAL. THE GUARANTOR HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHTS IT MAY HAVE TO A TRIAL BY JURY
IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN
CONNECTION WITH, THIS GUARANTY AGREEMENT. THE GUARANTOR ACKNOWLEDGES AND AGREES
THAT IT HAS RECEIVED FULL AND SUFFICIENT CONSIDERATION FOR THIS PROVISION AND
THAT THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE LENDER ENTERING INTO THE
LOAN AGREEMENT AND THE CERTIFICATE PURCHASER PURCHASING THE CERTIFICATE.


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         SECTION 5.11. POWER TO CONFESS JUDGMENT. THE GUARANTOR HEREBY
AUTHORIZES AND EMPOWERS THE PROTHONOTARY OR ANY ATTORNEY OF ANY COURT OF RECORD
WITHIN THE COMMONWEALTH OF PENNSYLVANIA OR ELSEWHERE AFTER AN EVENT OF DEFAULT
UNDER THIS GUARANTY AGREEMENT, THE LEASE, THE CONSTRUCTION AGENCY AGREEMENT, OR
ANY OF THE OPERATIVE DOCUMENTS AND, IN THE EVENT OF A REFINANCING, ANY
REFINANCING LOAN DOCUMENT, TO APPEAR FOR THE GUARANTOR, AND, WITH OR WITHOUT
DECLARATION FILED, CONFESS JUDGMENT AGAINST THE GUARANTOR IN FAVOR OF THE
FUNDING PARTIES, AS OF ANY TERM, FOR THE UNPAID OBLIGATIONS HEREUNDER, AND
INCLUDING, WITHOUT LIMITATION, ALL ACCRUED AND UNPAID INTEREST, CHARGES,
EXPENSES OR OTHER AMOUNTS PAYABLE UNDER THIS GUARANTY AGREEMENT, THE LEASE, THE
CONSTRUCTION AGENCY AGREEMENT, OR UNDER ANY OF THE OPERATIVE DOCUMENTS, AND, IN
THE EVENT OF A REFINANCING, ANY REFINANCING LOAN DOCUMENT, WHETHER BY
ACCELERATION OR OTHERWISE WITH COSTS OF SUIT AND A REASONABLE ATTORNEY'S
COMMISSION AS CERTIFIED BY THE FUNDING PARTIES WITH RELEASE OF ALL ERRORS,
WAIVING ALL LAWS EXEMPTING REAL OR PERSONAL PROPERTY FROM EXECUTION TO THE
EXTENT THAT SUCH LAWS MAY LAWFULLY BE WAIVED BY THE GUARANTOR. NO SINGLE
EXERCISE OF THE FOREGOING POWER TO CONFESS JUDGMENT SHALL BE DEEMED TO EXHAUST
THE POWER, WHETHER OR NOT ANY SUCH EXERCISE SHALL BE HELD BY ANY COURT TO BE
VALID, VOIDABLE, OR VOID, BUT THE POWER SHALL CONTINUE UNDIMINISHED AND IT MAY
BE EXERCISED FROM TIME TO TIME AS OFTEN AS THE FUNDING PARTIES SHALL ELECT,
UNTIL SUCH TIME AS THE FUNDING PARTIES SHALL HAVE RECEIVED PAYMENT IN FULL OF
THE OBLIGATIONS, INTEREST AND COSTS AND ALL AMOUNTS PAYABLE UNDER THIS GUARANTY
AGREEMENT.

         BY SIGNING THIS INSTRUMENT, THE GUARANTOR HEREBY ACKNOWLEDGES THAT IT
HAS READ, HAS HAD THE OPPORTUNITY TO HAVE IT REVIEWED BY LEGAL COUNSEL,
UNDERSTANDS, AND AGREES TO THE PROVISIONS CONTAINED HEREIN, INCLUDING THE
CONFESSION OF JUDGMENT PROVISION AND UNDERSTANDS THAT A CONFESSION OF JUDGMENT
CONSTITUTES A WAIVER OF RIGHTS IT OTHERWISE WOULD HAVE TO PRIOR NOTICE AND A
HEARING BEFORE A JUDGMENT IS ENTERED AGAINST IT AND WHICH MAY RESULT IN A COURT
JUDGMENT AGAINST THE GUARANTOR WITHOUT PRIOR NOTICE OR HEARING AND THAT THE 
AMOUNTS PAYABLE UNDER THIS GUARANTY AGREEMENT MAY BE COLLECTED FROM THE 
GUARANTOR REGARDLESS OF ANY CLAIM THE GUARANTOR MAY HAVE AGAINST ANY FUNDING 
PARTY.


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Initial

         SECTION 5.12. POWER TO EXECUTE ON A JUDGMENT WITHOUT HEARING. THE
GUARANTOR HEREBY AUTHORIZES AND EMPOWERS THE PROTHONOTARY OR ANY ATTORNEY OF ANY
COURT OF RECORD OR THE SHERIFF WITHIN THE COMMONWEALTH OF PENNSYLVANIA OR
ELSEWHERE, TO TAKE ALL ACTION ALLOWED BY OR PROVIDED FOR IN THE PENNSYLVANIA
RULES OF CIVIL PROCEDURE OR OTHER APPLICABLE RULES OF CIVIL PROCEDURE TO EXECUTE
ON ANY JUDGMENT ENTERED AGAINST THE GUARANTOR PURSUANT TO THE CONFESSION OF
JUDGMENT SET FORTH ABOVE WITHOUT PRIOR NOTICE OR HEARING OF ANY NATURE
WHATSOEVER, WAIVING ALL LAWS EXEMPTING REAL OR PERSONAL PROPERTY FROM EXECUTION,
TO THE EXTENT THAT SUCH LAWS MAY LAWFULLY BE WAIVED BY THE GUARANTOR. NO SINGLE
EXERCISE OF THE FOREGOING POWER TO EXECUTE ON JUDGMENT WITHOUT A HEARING SHALL
BE DEEMED TO EXHAUST THE POWER, WHETHER OR NOT ANY SUCH EXERCISE SHALL BE HELD
BY ANY COURT TO BE VALID, VOIDABLE OF VOID, BUT THE POWER SHALL CONTINUE
UNDIMINISHED AND IT MAY BE EXERCISED FROM TIME TO TIME AS OFTEN AS THE FUNDING
PARTIES SHALL ELECT UNTIL SUCH TIME AS THE FUNDING PARTIES SHALL HAVE RECEIVED
PAYMENT IN FULL OF THE OBLIGATIONS, INTEREST AND COSTS AND ALL AMOUNTS PAYABLE
UNDER THIS GUARANTY AGREEMENT.

         BY SIGNING THIS INSTRUMENT THE GUARANTOR HEREBY ACKNOWLEDGES THAT IT
HAS READ, HAS HAD THE OPPORTUNITY TO HAVE IT REVIEWED BY LEGAL COUNSEL,
UNDERSTANDS AND AGREES TO THE PROVISIONS CONTAINED HEREIN, INCLUDING THE POWER
TO EXECUTE ON JUDGMENT WITHOUT A HEARING, AND UNDERSTANDS THAT THE POWER TO
EXECUTE ON A JUDGMENT WITHOUT A HEARING CONSTITUTES A WAIVER OF RIGHTS IT
OTHERWISE WOULD HAVE TO PRIOR NOTICE AND A HEARING BEFORE EXECUTION ON A
JUDGMENT, AND THAT THE AMOUNTS PAYABLE UNDER THIS GUARANTY AGREEMENT MAY BE
COLLECTED FROM THE GUARANTOR REGARDLESS OF ANY CLAIM THAT THE GUARANTOR MAY HAVE
AGAINST ANY FUNDING PARTY.

         SECTION 5.13. SUBMISSION OF JURISDICTION. THE FUNDING PARTIES AND ALL
HOLDERS HEREBY SUBMIT TO THE NONEXCLUSIVE JURISDICTION OF THE UNITED STATES
DISTRICT COURT FOR THE WESTERN DISTRICT OF PENNSYLVANIA AND ANY COURT OF THE
COMMONWEALTH OF PENNSYLVANIA FOR PURPOSES OF ALL LEGAL PROCEEDINGS ARISING OUT
OF OR IN CONNECTION WITH THIS GUARANTY AGREEMENT AND THE TRANSACTIONS
CONTEMPLATED HEREBY. THE FUNDING PARTIES AND ALL HOLDERS IRREVOCABLY WAIVE, TO
THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH SUCH PARTY MAY NOW OR
HEREAFTER HAVE 

                                      -12-
                                                              Guaranty Agreement
<PAGE>   13


TO THE LAYING OF THE VENUE OF ANY SUCH PROCEEDINGS BROUGHT IN SUCH A COURT AND
ANY CLAIM THAT ANY SUCH PROCEEDING BROUGHT IN SUCH A COURT HAS BEEN BROUGHT IN
AN INCONVENIENT FORUM.



                                      -13-
                                                              Guaranty Agreement

<PAGE>   14



         IN WITNESS WHEREOF, the Guarantor has caused this Guaranty Agreement to
be duly executed and delivered by its officer thereunto duly authorized as of
the date first above written.



Attest:                                 FORE SYSTEMS HOLDING CORPORATION



/s/ CHRISTOPHER H. GEBHARDT             By: /s/ GARY J. BRUNNER
---------------------------                 -----------------------------------
                                        Name: Gary J. Brunner
                                              ---------------------------------
                                        Title: Treasurer               
                                               --------------------------------



                                      -14-
                                                              Guaranty Agreement