From what I remember, those bikes and shocks were kind of meant to go together (I had a hankering for one of them for awhile). The frame requires a shock tuned to handle a falling rate suspension design, which is kinda uncommon. I would spend some time on the Foes forum here - I'm sure you'll find some specific recommendations on what works well with it.
I'm going to guess that something like a Fox DHX would be a decent bet as a replacement, at least one of the higher models with a good amount of adjustability. Seem to be available in your price range.
I'd still do a little more research on the FXR in general before pulling the trigger though. Like I said, I believe your bike's got kind of an unconventional suspension action that was designed around a specifically tuned shock. I'm sure there are other shocks that will work, but I would look into it in a little more detail. You might find your best bet is doing the rebuild. You could also inquire directly to Foes and see what they recommend, or if they have any sort of trade-up program, etc.
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