Question: Is it possible to connect several networks into one? I have read articles about site to site configuration through IPsec. But I haven't seen any articles which explain if it possible to connect 3 or more networks into one.

Answer: 
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> As I understand a packet will be traversing the FORWARD chain only if it is not intended for the local host.
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Correct.

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> The clarification I have is how will the matching condition of -o $EXTIF be satisfied for any packets. I understand that -i $INTIF will be satisfied as it is the entry interface for the packet. 
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By the time the packet hits the "forward" chain the routing descision (including the descision on whether the accept the packet locally or send it onwards) has been made. So the output interface is known and can be matched against in rules.
-o $EXTIF will be satisfied because it is your egress interface for everything except your LAN. In other words the Internet. So as your LAN tries to reach some site on the Internet, it will traverse $INTIF and exit $EXTIF.