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According to this wiring diagram number 2 at relay should go to the distributor. Dose it need pulsating power or just power when the key turned on.

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The cut out signal or output of terminal two is a very carefully timed ground pulse which momentarily shorts the points out and prevents any sparks from the coil during that time. While the points are shorted the engine has no torque so gears in the OD are relaxed and the pawl can be pulled out of the sun gear by the spring in the solenoid. Actual length of the short depends on several factors and a specific time interval is vague but the literature says duration should not exceed a "few sparks". Anything longer than a few milliseconds and the engine would die.

The way the circuit works in the R9 is a somewhat involved path. When the solenoid is engaged and car is in OD a set of contacts in the solenoid close and place ground at terminal 6 which enters the relay box at terminal 6. Both relays in the box are energized since the solenoid is engaged so a set of contacts on the secondary relay are closed and path goes to a second set of contacts on the main relay which, because it is active, are now open. The ground can go no farther.

When kickdown is desired the kickdown switch opens the ground to relay terminal 5 and main relay drops out. When main relay drops and cuts power to the solenoid to disengage it, main relays second set of contacts close passing the ground out to terminal two and the coil. Even though the secondary relay has also lost power, because of mechanical delays and the way the hold coil in the solenoid is connected thru the secondary relay coil there is an overlap or delay of a few milliseconds before any action happens on that relay. During the short time both relay contacts are closed the cut out signal is present at terminal two. After the brief delay the secondary relay also relaxes opening its contact and cuts the ground to terminal two and the coil. The solenoid is also relaxing during this time and and opens its set of contacts providing ground to terminal 6 to make sure there is no longer a ground available to the coil. The interval the coil is shorted is brief and engine does not die. All in all it is a fairly precise circuit and if there is anything mechanical preventing or delaying relay or solenoid action the cut out signal will be too long and can kill the engine.

As soon as kickdown is over and car has passed or OD locked out, the kickdown switch closes and conditions are again present so relays can either energize and OD can be re-engaged or if lockout option was selected, that switch was opened so relays will stay turned off.