<PAGE>

                                                                   EXHIBIT 10.23

                                     NOTE
                                     ----
$750,000.00                                       Sunnyvale, California
May 16, 2000

          FOR VALUE RECEIVED, the undersigned ("Borrower") promises to pay to
iBEAM Broadcasting Corporation, a Delaware corporation (the "Company"), or
order, at its principal office the principal sum of $750,000.00 together with
interest on the unpaid principal hereof from the date hereof at the rate of six
and one-half percent (6.5%) per annum, compounded annually.

          This Note is secured by a pledge of those shares of the Company's
common stock that Borrower has purchased with the proceeds of this Note (the
"Shares") pursuant to a Security Agreement of even date herewith, and is subject
to all the provisions thereof. Principal and interest shall be due and payable
on the earlier of (i) four (4) years from the date of this Note, or (ii) ninety
(90) days after termination of Borrower as a service provider of the Company,
for any reason or no reason, provided such 90-day period shall be increased to
180 days if the Company's securities are publicly traded and the undersigned is
restricted from selling the Shares under applicable securities laws or an
affiliate's agreement. Payment of principal and interest shall be made in lawful
money of the United States of America. The undersigned may at any time prepay
all or any portion of the principal or interest owing hereunder. This Note is
subject to the terms of that certain Notice of Grant of Stock Options and Option
Agreement dated as of May 16, 2000.  In addition, this Note shall be prepaid to
the extent of any proceeds from the sale (net of taxes) of the Shares, which
proceeds shall be used to repay the principal and interest owing hereunder
immediately upon receipt of such proceeds by Borrower. The holder of this Note
shall have full recourse against Borrower and shall not be required to proceed
against the Shares in the event of a default of this Note by Borrower. Should
any action be instituted for the collection of this Note, the reasonable costs
and attorneys' fees therein of the holder shall be paid by Borrower.  If
Borrower is married, Borrower's spouse shall also execute this Note and the
Security Agreement in the same capacity as Borrower, and the term "Borrower"
shall mean both persons, jointly and severally.

Signature: /s/ Joseph C. Shepela
           ____________________________________

Name:       Joseph C. Shepela

Spouse's Signature: /s/ Karen S. Shepela
                    _____________________________________

Spouse's Name:       Karen S. Shepela
<PAGE>

                              SECURITY AGREEMENT
                              ------------------

     This Security Agreement is made as of May 16, 2000 between iBEAM
Broadcasting Corporation, a Delaware corporation ("Pledgee"), and Joseph C.
Shepela and Karen S. Shepela (jointly, "Pledgor").

                                   RECITALS

     Pursuant to Pledgor's purchase of shares of Pledgee's common stock under
the Notice of Grant of Stock Options and Option Agreement dated May 16, 2000
(the "Option Agreement"), between Pledgor and Pledgee, Pledgee has agreed to
accept delivery of a promissory note (the "Note") relating to Pledgor's purchase
of 75,000 shares of Pledgee's common stock (the "Shares") at a price of $10.00
per share, for a total purchase price of $750,000.00.

NOW, THEREFORE, it is agreed as follows:

1.   Creation and Description of Security Interest.  In consideration of the
     ---------------------------------------------
transfer of the Shares to Pledgor under the Option Agreement, Pledgor, pursuant
to the California Commercial Code, hereby pledges all of such Shares (herein
sometimes referred to as the "Collateral") represented by certificate number
______, duly endorsed in blank or with executed stock powers, and herewith
delivers said certificate to the Secretary of Pledgee ("Pledgeholder"), who
shall hold said certificate subject to the terms and conditions of this Security
Agreement.  The Shares (together with an executed blank stock assignment for use
in transferring all or a portion of the Shares to Pledgee if, as and when
required pursuant to this Security Agreement) shall be held by the Pledgeholder
as security for the repayment of the Note, and any extensions or renewals
thereof, to be executed by Pledgor pursuant to the terms of the Option
Agreement, and the Pledgeholder shall not encumber or dispose of such Shares
except in accordance with the provisions of this Security Agreement, the Note,
and the Option Agreement.

2.   Pledgor's Representations and Covenants.  To induce Pledgee to enter into
     ---------------------------------------
this Security Agreement, Pledgor represents and covenants to Pledgee, its
successors and assigns, as follows:

          a.  Payment of Indebtedness.  Pledgor will pay the principal sum of
              -----------------------
          the Note secured hereby, together with interest thereon, at the time
          and in the manner provided in the Note.

          b.  Encumbrances.  The Shares are free of all other encumbrances,
              ------------
          defenses and liens, and Pledgor will not further encumber the Shares
          without the prior written consent of Pledgee.

          c.  Margin Regulations.  In the event that Shares now or later become
              ------------------
          margin-listed by the Federal Reserve Board and Pledgee is classified
          as a "lender" within the meaning of the regulations under Part 207 of
          Title 12 of the Code of Federal Regulations ("Regulation G"), Pledgor
          agrees to cooperate with Pledgee in making any amendments to the Note
          or providing any additional collateral as may be necessary to comply
          with such regulations.

3.   Voting Rights.  During the term of this pledge and so long as all payments
     -------------
of principal and interest are made as they become due under the terms of the
Note, Pledgor shall have the right to vote all of the Shares hereunder.
<PAGE>

4.   Stock Adjustments.  In the event that during the term of the pledge any
     -----------------
stock dividend, reclassification, readjustment or other changes are declared or
made in the capital structure of Pledgee, all new, substituted and additional
shares or other securities issued by reason of any such change shall be
delivered to and held by the Pledgee under the terms of this Security Agreement
in the same manner as the Shares originally pledged hereunder.  In the event of
substitution of such securities, Pledgor, Pledgee and Pledgeholder shall
cooperate and execute such documents as are reasonable so as to provide for the
substitution of such collateral and, upon such substitution, references to
"Shares" in this Security Agreement shall include the substituted shares of
capital stock of Pledgor as a result thereof.

5.   Options and Rights.  In the event that, during the term of this pledge,
     ------------------
subscription options or other rights shall be issued in connection with the
Shares, such rights or options shall be the property of Pledgor and, if
exercised by Pledgor, all new stock or other securities so acquired by Pledgor
as they relate to the  Shares then held by Pledgeholder shall be immediately
delivered to Pledgeholder, to be held under the terms of this Security Agreement
in the same manner as the Shares.

6.   Default.  Pledgor shall be deemed to be in default of the Note and of this
     -------
Security Agreement in the event that (a) payment of principal or interest on the
Note shall be delinquent for a period of 10 days or more; or (b) Pledgor fails
to perform any of the covenants set forth in the Note, the Option Agreement, or
this Security Agreement for a period of 10 days after written notice thereof
from Pledgee.  In the case of an event of default, as set forth above, Pledgee
shall have the right to accelerate payment of the Note upon notice to Pledgor,
and Pledgee shall thereafter be entitled to pursue its remedies under the
California Commercial Code.

7.   Release of Collateral.  Subject to any applicable contrary rules under
     ---------------------
Regulation G, there shall be released from this pledge a portion of Shares held
by Pledgeholder hereunder upon payments of the principal of the Note.  The
number of Shares which shall be released shall be that number of full shares
which bears the same proportion to the initial number of Shares hereunder as the
payment of principal bears to the initial full principal amount of the Note.

8.   Withdrawal or Substitution of Collateral.  Pledgor shall not sell,
     ----------------------------------------
withdraw, pledge, substitute or otherwise dispose of all or any part of the
collateral without the prior written consent of Pledgee.

9.   Term.  This pledge of Shares shall continue until the payment of all
     ----
indebtedness secured hereby, at which time the remaining Shares shall be
promptly delivered to Pledgor, subject to the provisions for prior release of a
portion of the collateral as provided in paragraph 7, above, and subject to the
terms of the Option Agreement.

10.  Insolvency.  Pledgor agrees that if a bankruptcy or insolvency proceeding
     ----------
is instituted by or against it, or if a receiver is appointed for the property
of Pledgor, or if Pledgor makes an assignment for the benefit of creditors, the
entire amount unpaid on the Note shall become immediately due and payable, and
Pledgee may proceed as provided in the case of default.

11.  Pledgeholder Liability.  In the absence of willful misconduct or gross
     ----------------------
negligence, Pledgeholder shall not be liable to any party for any of his acts,
or omissions to act, as Pledgeholder.

12.  Invalidity of Particular Provisions.  Pledgor and Pledgee agree that the
     -----------------------------------
enforceability or invalidity of any provision or provisions of this Security
Agreement shall not render any other provision or provisions herein contained
unenforceable or invalid.
<PAGE>

13.  Successors or Assigns.  Pledgor and Pledgee agree that all of the terms of
     ---------------------
this Security Agreement shall be binding on their respective successors and
assigns, and that the term "Pledgor" and the term "Pledgee" as used herein shall
be deemed to include, for all purposes, the respective designees, successors,
assigns, heirs, executors and administrators.

14.  Joint and Several.  If Pledgor consists of two persons, the obligations of
     -----------------
such persons hereunder shall be joint and several.

15.  Governing Law.  This Security Agreement shall be interpreted and governed
     -------------
under the internal substantive laws, but not the choice of law rules, of
California.


IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
day and year first above written.
<PAGE>

PLEDGOR                                /s/ Joseph C. Shepela
                                       _____________________________________
                                       Signature



                                       Print Name: Joseph C. Shepela

                              Address: _______________________
                                       _______________________





                                       /s/ Karen S. Shepela
                                       _____________________________________
                                       Signature



                                       Print Name: Karen S. Shepela

                              Address: _______________________
                                       _______________________


PLEDGEE                                iBEAM BROADCASTING
                                       CORPORATION
                                       a Delaware corporation


                                       /s/ Daniel Sroka
                                       _____________________________________
                                       Signature


                                       Daniel Sroka
                                       _____________________________________
                                       Print Name


                                       Vice President
                                       _____________________________________
                                       Title


PLEDGEHOLDER                           /s/ Chris Dier
                                       _____________________________________
                                       Secretary of
                                       iBEAM Broadcasting Corporation