When you are working in the Finder and you discover that you need a terminal window you have to open "Terminal" and "cd" to the folder you were working on. With OpenTerminal you just click its icon or use the Finder's contextual menu and a terminal with the correct path shows up.
The advantage of OpenTerminal over other available tools is that it can run in the background (without using processor time) and react instantly because it doesn't have to start up first. It's also more refined than the other tools I know of: it includes workarounds for several Finder and Terminal bugs, supports Spaces, and it doesn't open superfluous terminal windows.
The sourcecode is also available.