I have my persistence.xml with the same name using TopLink under the META-INF directory.
Then, I have my code calling it with:
Put the "hibernate-entitymanager.jar" in the classpath of application.
For newer versions, you should use "hibernate-core.jar" instead of the deprecated hibernate-entitymanager
If you are running through some IDE, like Eclipse: Project Properties -> Java Build Path -> Libraries.
Otherwise put it in the /lib of your application.