The virus lies in the nerve centers at the base of the spine and the neck. Depending on which type you have (HSV1 typically oral cold sores or HSV2 typically genital sores) every so often the virus 'wakes up' and comes to the surface of the skin. It effects each person differently and depends on individual immune system. When it comes to the surface it manifests in many different ways - bumps, pimples, open sores, sore throat, swelling of lymph nodes just a few.
Even though someone does not have 'signs of it' they can still be contagious through something called 'asymptomatic shedding.'