INCORPORATION is a legal process through which a company receives a charter and the state in which it is based allows it to operate as a corporation.
OPEN REPURCHASE AGREEMENT is a repurchase agreement with no set maturity date and often a rate of return that fluctuates on a daily basis, depending on market rates. The yield on this type of investment is higher than on a daily repurchase agreement because the agreement often runs several days and the dealer usually requires some short notice before the investor can withdraw funds.
SUBORDINATED DEBT is debt over which senior debt takes priority. In the event of bankruptcy, subordinated debt holders receive payment only after senior debt claims are paid in full. There is a pecking order determining the sequence in which a company will pay off its debt instruments, subordinate (or junior) issues will not be repaid until unsubordinated (or senior) debt has been repaid in full.
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