A server can connect directly to the regular telephone network (PSTN) if you install a telephony interface card, but if you're looking at VOIP then you can just use one of the many VOIP providers that will originate and terminate calls.
Terminating calls is placing calls to the regular telephone network and originating is incoming calls that are made to reglar phone number and then sent to you VOIP server.
Incoming/Outgoing 'lines' will normally be described as the number of concurrent 'channels' that you can have.
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