Performance center - where does the actual testing happen

Hi

We want to test the performacne of our ASP.NET 2.0 application hosted on windows 2003 that has IIS server 6.0.

If we record scripts usning VU Gen and run the test using performacne center where does the actual testing happen?

Does the testing happen on the server where Performacne center is hosted or does it occur on the client machine which is used to access the performacne center?

how does the PC tool works?

Thanks
Ashok