Exhibit 10.2


SECURED TERM PROMISSORY NOTE


	
  $7,500,000

  	
  Advance Date; October
  25, 2006

  
	
   

  	
  Maturity Date: April 1,
  2010

  



 


FOR VALUE RECEIVED, PONIARD PHARMACEUTICALS, INC., a Washington
corporation, for itself and each of its Subsidiaries (the “Borrower”) hereby
promises to pay to the order of Merrill Lynch Capital, a division of Merrill
Lynch Business Financial Services Inc., or the holder of this Note (the “Lender”)
in care of Silicon Valley Bank, as agent under the Loan Agreement (as defined
below), 3003 Tasman Drive, Santa Clara CA 95054 or such other place of payment
as the holder of this Secured Term Promissory Note (this “Promissory Note”) may
specify from time to time in writing, in lawful money of the United States of
America, the principal amount of Seven Million Five Hundred Thousand Dollars
($7,500,000) or such other principal amount as Lender has advanced to Borrower,
together with interest at a fixed rate equal to the U.S. Treasury Note yield to
maturity for a term equal to thirty-six months in effect on the Advance Date
above and as then reported in the Wall Street Journal, plus 3.00% per annum
(or if and when applicable, at a
rate equal to the ”Default Rate” specified in Section 2.3(b) of the Loan
Agreement referenced below)  based upon a year consisting of 360 days,
with interest computed daily based on the actual number of days in each month
until the principal balance is paid in full.


This Promissory Note is executed and delivered in connection with that
certain Loan and Security Agreement dated October 25, 2006, by and among
Borrower, Silicon Valley Bank, as agent for the Lenders, and Silicon Valley
Bank and Merrill Lynch Capital, as Lenders (as the same may from time to time
be amended, modified or supplemented in accordance with its terms, the “Loan
Agreement”), and is entitled to the benefit and security of the Loan Agreement
and the other Loan Documents (as defined in the Loan Agreement), to which
reference is made for a statement of all of the terms and conditions thereof.  All payments shall be made in accordance with
the Loan Agreement.  All terms defined in
the Loan Agreement shall have the same definitions when used herein, unless
otherwise defined herein.  An Event of
Default under the Loan Agreement shall constitute a default under this
Promissory Note, and upon any such Event of Default and default, all principal
and interest and other obligations owing under this Promissory Note may be
accelerated and declared immediately due and payable as provided for in the
Loan Agreement.  Reference to the Loan
Agreement shall not affect or impair the absolute and unconditional obligation
of the Borrower to pay all principal and interest and premium, if any, under
this Promissory Note upon demand or as otherwise provided herein


Borrower waives presentment and demand for payment, notice of dishonor,
protest and notice of protest under the UCC or any applicable law.   Borrower agrees to make all payments under
this Promissory Note without setoff, recoupment or deduction and regardless of
any counterclaim or defense.  This
Promissory Note has been negotiated and delivered to Lender and is payable in
the State of California.  This Promissory
Note shall be governed by and construed and enforced in accordance with, the
laws of the State of California, excluding any conflicts of law rules or
principles that would cause the application of the laws of any other
jurisdiction.  Without limiting the
generality of the preceding paragraph, the provisions of Section 12 of the Loan
Agreement regarding jurisdiction, venue and jury trial waiver are incorporated
herein.











 


	
   

  	
  PONIARD PHARMACEUTICALS, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
  /S/ Gerald McMahon

  	
   

  
	
   

  	
  Title:

  	
   

  	
  Gerald McMahon

  	
   

  
	
   

  	
   

  	
  Chairman, President and

  
	
   

  	
   

  	
  Chief Executive Officer