What is difference between stored procedure transformation and external procedure transformation?

In case of storedprocedure transformation procedure will be compiled and executed in a relational data source.U need data base connection to import the stored procedure in to u�r maping.Where as in external procedure transformation procedure or function will be executed out side of data source.Ie u need to make it as a DLL to access in u r maping.No need to have data base connection in case of external procedure transformation.