The little threaded rod straddles the two arms where the cable of a V-brake would normally run. You can adjust it for length.
The cable housing stops at the little boomerang-shaped rocker, while the cable passes through it and clamps halfway down the arm. When you apply the brake, the rocker swings outwards, which pulls the tops of the arms together.
ez-auctions a lister on ebay.com has a bunch of them and they usually have a listing up with both an auction price and a BIN. I just bought one for a fellow retrobike member that lives in the uk and shipped it over for him.
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