Hibernate - Annotations vs XML

Recently I was involved in a healthy discussion at my work on using Annotations for Entities. We have a Java web application with Spring MVC, Hibernate and Entities with hbm.xml files. Entities with XML work well however there is an interest in the team to use annotations. Here are my thoughts - pros and cons of each approach. I have used both approaches, however I like using hbm xml files over annotations for entities. That said I do like the use of annotations in Spring MVC, TestNG, or on service layers to mark transactions.
Why stick to hbm.xml files?

1. Well, if we think back to days before hibernate, when we used JDBC we had the problem where the SQL code was embedded in Java classes, thus causing many maintainability problems. With Hibernate xml files we got a clean way to keep them seperate - the entity pojo's were free of the sql clutter. With Annotations in Entites we are going back to that same model !!!
2. Entities are cross cutting code - they are used in all layers, starting from DB all the way to JSP in many cases. Cross cutting logic should not have code that looks more biased to a certain layer.
3. If you are working in a team that is split into Backend Dev team and frontend dev team then the front end team does not need to see all those annotations. Well what would be the argument if frontend team wants to add their own View specific annotations to entities for ease of use?
4. If you have a code base that takes long time to compile and build (fortunately for us it takes a few seconds), having an hbm xml file is better. No need to recompile.
5. If you have to migrate from xml to annotations on an existing ongoing project what is cost justification to use annotations?

Why move to Annotations?

1. Well, as my collegue at work explains, it improves maintainability by having only one file
2. As Paul Mazak would say, the mantra is "less code characters", helps in long run.
3. Annotations are cool ! Learn some new stuff

Well in the end it is a religious debate and fun as well. I will stick to hbm xml so far, playing with Annotations as I get an oppurtunity for new development.