Modifier extensions is made for creation of automatic modification rules. It is based on the same group-per-interceptor principle as Tagger, so if you want to know, how to set it up, read Tagger guide.
Modify rules contain the modification logic like automatic replacements etc. These rules are executed on PDUs with specified tag / all PDUs if no tag is specified.
Modify rule types (Replace, Add Header, ...) might be added by extensions. On the following screenshot, you can see the Replace rule configuration: