A term is a word or expression used with a particular meaning. "Rap," "punk," "grunge," and "heavy metal" are terms that describe particular styles of music. "Sweetie" is a term of endearment, at least to most people.
Terms can also mean the conditions of an agreement: when you rent an apartment, you agree to certain terms — that you'll pay the rent, you won't have loud parties, etc. If you're "on good terms with someone," you like each other. Term can also be a defined period of time. Spring term at school is the spring semester, and you may be assigned a term paper — to demonstrate how brilliant you've become during that time period.