The original reverse lockout switch would have had a short plunger protruding from the mounting flange side. When the transmission is shifted into reverse, the lockout rail pushes backwards and depresses the plunger. This, in effect, opens the circuit to the governor. The end result is cutting the power to the solenoid (taking the transmission out of overdrive).
The lockout switch was determined to be a redundant control and was eliminated by Ford after 1951. In the factory service bulletins there is one covering this issue. Rather than replacing a defective lockout switch, they recommended keeping it in place, but bypassing it electrically. Keeping the actual switch mounted to the transmission prevents gear oil leaking from the opening. It can be bypassed because there was always a mechanical part of the transmission that took it out of overdrive whenever you shifted into reverse.
Just connect the two wires together. I recommend soldering them together and covering the joint with heat shrink sleeve. Or run a new wire replacing the two leads.