A Libyan rebel negotiator said talks with a Gaddafi spokesman over the peaceful surrender of one of the former dictator's last strongholds failed on Sunday. The rebel forces have surrounded the town of Bani Walid and are now waiting to launch a final assault. The interim council had hoped that the town would surrender rather than see bloodshed, but the rebels say a small minority of heavily-armed hardcore loyalists are stoking fear and preventing a peaceful surrender. Forces are also closing in on Gaddafi's hometown of Sirte, but resistance there is tough. The former Libyan strongman is still in hiding.