Peter Tutty has pretty well described the dropouts.
I would just add that they were sold by Super Champion, the makers of what is commonly called the Osgear, which is what the English distributor, Constrictor, called the Super Champion striking fork gears (and later, other types of Super Champion gears they imported).
The reason that the vertical dropout was included in these rear ends was, as Peter, states, to be able to get the rear sprockets as close as possible to the striking fork (necessary for efffective operation of the gears) and still be able to remove and replace the rear wheel quickly. This would not be possible if the wheel had to be slid forwards in a normal dropout to remove it, since the sprocket would then foul on the striking fork.
Some riders who used Osgears did so successfully on frames with track ends, rather than Osgear ends, since the wheel is, of course, removed to the rear and, therefore, away from the striking fork.
To see Claud Butler's variation on this type of end, see the absolutely gorgeous CB currently on UK eBay, item number 230103704704. These dropouts were introduced by Claud Butler in the 1930's, and continued post war. Incidentally, I'm not related to the seller, but how I wish that frame was my size!
Neil Foddering Weymouth, Dorset, England
>From: "David Bean" <beandk@rcn.com>
>Reply-To: beandk@rcn.com
>To: "Classic Rendezvous (E-mail)" <classicrendezvous@bikelist.org>
>Subject: [CR]Cool frame on ebay. What is it?
>Date: Fri, 16 Mar 2007 18:30:39 -0400
>
>Can anyone tell me anything about item 290094023171 ? Pay particular
>attention to the great dropouts - and explain them!
>
>David Bean
>Arlington, MA