<PAGE>
                                                                    EXHIBIT 10.G


               AMENDMENT NO. 1 TO THE LOAN AND SECURITY AGREEMENT

         AMENDMENT NO. 1 to the Loan and Security Agreement dated as of May 28,
1998 ("Amendment No. 1") by and between NAPCO SECURITY SYSTEMS, INC., a New York
corporation having a place of business at 333 Bayview Avenue, Amityville, New
York 11701 (the "Debtor") and Marine Midland Bank, having a place of business at
534 Broad Hollow Road, Melville, New York 11747 (the "Secured Party").

                              W I T N E S S E T H :

         WHEREAS, as of May 12, 1997, Debtor and Secured Party had entered into
a certain loan and security agreement, as further amended from time to time (the
"Agreement");

         WHEREAS, the Debtor has requested that the Secured Party advance the
sum of $2,500,000.00 pursuant to the terms of the Term Loan Note (as hereinafter
defined) and the Secured Party has agreed to do so, in the manner set forth
below, provided however, that, among other things, Debtor execute this Amendment
No. 1.

         NOW, THEREFORE, in consideration of the mutual promises and for other
good and valuable consideration, the receipt of which is hereby acknowledged,
the parties hereto agree as follows:

         1. The definition of "Transaction Documents" contained in Section 1.1.
of the Agreement is hereby amended to read in its entirety as follows:

         "Transaction Documents" shall mean, individually, jointly, severally
         and collectively, the Agreement (including this Amendment No. 1) and
         all documents, including, without limitation, the Term Loan Note,
         collateral documents, letter of credit agreements, notes, acceptance
         credit agreements, security agreements, pledges, guaranties, mortgages,
         title insurance, assignments, and subordination agreements required to
         be executed by Debtor, any Third Party, or any Responsible Party
         pursuant hereto or in connection herewith, in connection with the
         issuance of a certain standby letter of credit in the amount not to
         exceed $2,500,000.00 by Secured Party in favor of Citibank, N.A., at
         the request of and for the benefit of Debtor, the reimbursement
         obligations being evidenced by a promissory note in the principal sum
         not to exceed $2,500,000.00, and a letter of credit application and
         reimbursement agreement, each dated as of May 12, 1997, and a certain
         uncommitted trade line established by Marine in favor of Debtor to
         provide for commercial and standby letters of credit, evidenced by,
         among other documents, a continuing letter of credit agreement, and a
         continuing indemnity agreement, each dated as of May 12, 1997, and the
         Term Loan Note in the principal sum of $2,500,000.00, and all other
         documents, agreements, reaffirmations, certificates and resolutions
         related thereto, and amendments or supplements thereto, all such other
         agreements, resolutions, certificates, resolutions and opinion letters
         executed and/or issued as a condition precedent to or in connection
         with the Agreement, the Term Loan Note and all such other documents,
         agreements, and instruments delivered hereunder or as a supplement or
         amendment thereto or as Secured Party may reasonably

                                      E-83

<PAGE>
         require from time to time in order to evidence and/or secure the
         indebtedness of Debtor to Secured Party or to create, perfect, continue
         the perfection or protect the Secured Party's security interest in the
         Collateral.

         2. The definition "Term Loan" shall be added to Section 1.1. of the
Agreement and shall read as follows:

         "Term Loan" shall mean the $2,500,000.00 term loan made available to
         Debtor to Secured Party pursuant to the Term Loan Note.

         3. The definition of "Term Loan Note" shall be added to Section 1.1. of
the Agreement and shall read as follows:

         "1998 Term Loan Note" shall mean the $2,500,000.00 note evidencing the
         Term Loan executed by Debtor and delivered to Secured Party as of even
         date hereof; Debtor has used or will use the proceeds of the Term Loan
         Note to finance the purchase by Debtor of 889,576 shares of Debtor's
         common stock, $.01 par value, owned by Kenneth Rosenberg, pursuant to a
         certain stock purchase agreement dated as of even date hereof by and
         between Kenneth Rosenberg and the Corporation (the "Stock Purchase
         Agreement").

         4. New Sections 4.26. and 4.27 are added as follows:

                  Section 4.26. Stock Purchase Agreement, etc.

                  Debtor has heretofore delivered to Secured Party true and
         complete copies of the Stock Purchase Agreement, the promissory note in
         the principal sum of $1,947,880.00, executed by Debtor in favor of
         Kenneth Rosenberg, and all other agreements and documents by and
         between Debtor and Kenneth Rosenberg or by Debtor in favor of Kenneth
         Rosenberg, including all amendments thereof. Debtor represents and
         warrants to Secured Party that it has disclosed in writing all of the
         terms of the purchase by Debtor of 889,576 shares of the Debtor's
         common stock, $.01 par value, owned by Kenneth Rosenberg, and any other
         ancillary transactions by and between Debtor and Kenneth Rosenberg in
         connection therewith.

                  Section 4.27. Term Loan Note Proceeds

         The proceeds of the Term Loan shall be used by Debtor to finance the
         purchase by Debtor of 889,576 shares of Debtor's common stock, $.01 par
         value, owned by Kenneth Rosenberg, pursuant to the Stock Purchase
         Agreement.

         5. Section 9.26. of the Agreement shall be deleted in its entirety
replaced with the following:

                  9.26. FINANCIAL COVENANTS. The financial covenants to include
                  the following:

                  (a) Debtor and its Consolidated Subsidiaries shall maintain,
                  on a consolidated basis, a ratio of Total Liabilities to
                  Tangible Net Worth of not greater than (to be tested quarterly
                  based upon the financial statements required to be presented
                  to Secured Party pursuant to Section 9.1.):

                                      E-84


<PAGE>
                  (i) during the period commencing as of the date hereof through
                  June 29, 1999, 1.35 to 1.0,

                  (ii) during the period commencing on June 30, 1999 through
                  June 29, 2000, 1.25 to 1, and

                  (iii) during the period commencing on June 30, 2000 through
                  June 29, 2001, and thereafter while any Indebtedness remains
                  outstanding, 1.10 to 1.

                  (b) Debtor and its Consolidated Subsidiaries shall maintain,
                  at fiscal year end June 30, 1998, on a consolidated basis, a
                  minimum Tangible Net Worth of not less than $25,400,000.00,
                  and at each fiscal year end thereafter, the required minimum
                  Tangible Net Worth shall increase by $1,000,000.00 per fiscal
                  year; to be tested each fiscal quarter end of each fiscal
                  year, based upon the financial statements required to be
                  presented to Secured Party pursuant to Section 9.1.
                  hereinabove.

                  (c) At all times, Debtor and its Consolidated Subsidiaries
                  shall maintain, on a consolidated basis, a ratio of Current
                  Assets to Current Liabilities (i) of not less than 2.75 to 1
                  from the date hereof through June 29, 1998, (ii) of not less
                  than 3.00 to 1 from June 30, 1998 through June 29, 1999, (iii)
                  of not less than 3.25 to 1 from June 30, 1999 through June 29,
                  2000 and beyond, to be tested each fiscal quarter end of each
                  fiscal year, based upon the financial statements required to
                  be presented to Secured Party pursuant to Section 9.1.
                  hereinabove.

                  (d) Debtor and its Consolidated Subsidiaries shall maintain,
                  on a consolidated basis, a minimum "Debt Service Coverage
                  Ratio" of 1.25 to 1, to be tested at the end of each fiscal
                  year, based upon the financial statements required to be
                  presented to Secured Party pursuant to Section 9.1.
                  hereinabove.

                  (e) At all times during the Loan Period, Debtor and its
                  Consolidated Subsidiaries shall maintain, on a consolidated
                  basis, a ratio of the aggregate of cash plus total Receivables
                  to Current Liabilities of not less than 1.25 to 1 from the
                  date hereof until all indebtedness owed to Secured Party is
                  paid in full, to be tested each fiscal quarter of each fiscal
                  year, based upon the financial statements required to be
                  presented to Secured Party pursuant to Section 9.1.
                  hereinabove.

                  The above ratios of this Section 9.26. are being calculated
                  assuming that in the last year of the Loan Agreement, the
                  Advances under the Revolving Credit Facility are viewed as
                  long-term debt, unless there is an event of default which is
                  continuing under the Revolving Credit Facility.

         6. As an inducement to the Bank extending the Term Loan, and modifying
the provisions of the Agreement pursuant to the terms herein, Debtor represents

                                      E-85

<PAGE>
and warrants to Secured Party that, as of the date of execution of this
Amendment No. 1, (i) the representations and warranties set forth in Article 4
of the Agreement and the representations and warranties of Debtor and any Third
Party set forth in the other Transaction Documents to which any is a party are
true and correct in all respects, (ii) no event has occurred and is continuing
which constitutes an "Event of Default" under any of the Transaction Documents
(as "Event of Default" is defined in each of those Transaction Documents), and
(iii) Debtor is in compliance with the covenants set forth in Articles 9 and 10
of the Agreement.

         7. Debtor represents and warrants to Secured Party that there are no
offsets, defenses or counterclaims to the payment of the indebtedness owing
Secured Party, including the Advances, and to the continuing general security
interest in the Collateral granted to Secured Party by Debtor as security for
payment of the indebtedness, as fully described in the Agreement.

         8. Except as modified herein, all other provisions of the Agreement and
the other Transaction Documents remain unmodified and are in full force and
effect.

         18. This Amendment No. 1 shall be governed by the laws of the
State of
New York.

IN WITNESS WHEREOF, the parties have executed this Amendment No. 1 as of the day
and year first above written.

WITNESS:                                            MARINE MIDLAND BANK

________________________                     By:    /s/ JAMES P. JOHNIS
                                                    James P. Johnis
                                                    Vice President

WITNESS:                                            NAPCO SECURITY
SYSTEMS, INC.

_________________________                    By:    /s/ KEVIN BUCHEL
                                                    Kevin Buchel
                                                    Senior Vice President

                                      E-86