Its a thermal operated electric switch. Power goes in on one lug, fan on th other. When it reaches design temperature, switch closes and fan runs. I would suggest testing the switch before trusting it on a conversion. Hook a meter or test light to terminals, put switch in a pot of water and bring up the temp. Watch at what temp the switch closes, and opens. The close and open depends on what switch rating you have installed. On a used engine, I would not trust it until I see it work.
Paul