Problem is you're reading one line from file1 for every line in file2 (so you soon run out of lines in file1).

I think you rather want nested loops, i.e. something along the lines of

open F1, "file1" or die $!;
while (my $find = <F1>) {
    chomp $find;
    
    open F2, "file2" or die $!;
    while (<F2>) {
        print if /$find/ .. /frame-relay/;
    }
}
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P.S. sorry about the first reply... (it didn't look like you wanted to learn Perl).