hibernate hbm.xml mapping or annotations?

System

LiveSite 7.1
Time to go after some data, we have extensive set of classes that use annotations for their mapping. Do we have to change over to use hbm.xml files or can can I use my annotated classes. Where would my persistence.xml file reside to set up the persistence-units? If it is in a manual please tell me which one.

Thanks again for all the help