According to Wikipedia: "In 1973, a task force was established to begin development of a follow on system. The 400 kt warhead was greatly over-powered for the QRA mission, and a smaller warhead required greater accuracy. The contract went to Martin Marietta in 1975 and the first development launches began in 1977. Pershing II was to use the new W85 warhead with a five to 50 kt variable yield or an earth-penetrator W86 warhead. The warhead was to be packaged in a maneuverable reentry vehicle (MARV) with active radar guidance, and it would be launched with the Pershing I rocket engines. In 1975, the U.S.A. turned down a request from Israel to purchase the new Pershing II."