<PAGE>   1
                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549


                                   FORM 10-Q
(Mark One)
        [X] Quarterly report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934

         FOR THE QUARTERLY PERIOD ENDED MARCH 26, 1999   or

         [ ] Transition report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
         For the transition period from ______________ to _______________

         COMMISSION FILE NUMBER 0-16059

                               JASON INCORPORATED
             (Exact name of registrant as specified in its charter)


          WISCONSIN                                      39-1756840
(State or other jurisdiction of               (IRS Employer Identification No.)
incorporation or organization)


           411 EAST WISCONSIN AVENUE, SUITE 2120, MILWAUKEE, WI 53202
                    (Address of principal executive offices)


                                 (414) 277-9300
              (Registrant's telephone number, including area code)


Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Sections 13 or 15(d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the Registrant
was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.

                                    Yes    X                  No
                                         -----                    -----


On March 26, 1999 there were outstanding 20,380,236 shares of the Registrant's
$.10 par value common stock.

                                  Page 1 of 14
<PAGE>   2
                               JASON INCORPORATED

                                    FORM 10-Q

                                 MARCH 26, 1999

                                      INDEX


PART I.  FINANCIAL INFORMATION                                          PAGE NO.

Statements of Income for the Three Months
         Ended March 26, 1999 and March 27, 1998 .......................     3

Balance Sheets as at March 26, 1999 and
         December 25, 1998 .............................................     4

Statements of Cash Flows for the Three Months
          Ended March 26, 1999 and March 27, 1998.......................     5

Notes to Financial Statements ..........................................    6-9

Management's Discussion and Analysis of
         Results of Operations and Financial Condition .................   10-13


PART II.  OTHER INFORMATION

Item 1            Legal Proceedings ....................................    14

Item 2            Changes in Securities ................................    14

Item 3            Defaults Upon Senior Securities ......................    14

Item 4            Submission of Matters to a Vote of
                      Security Holders .................................    14

Item 5            Other Information ....................................    14

Item 6            (a)  Exhibits ........................................    14

                  (b)  Reports on Form 8-K .............................    14

Signatures .............................................................    14

                                  Page 2 of 14
<PAGE>   3
                               JASON INCORPORATED
                              STATEMENTS OF INCOME

                (DOLLARS IN THOUSANDS, EXCEPT EARNINGS PER SHARE)
                -------------------------------------------------





<TABLE>
<CAPTION>
                                                      FOR THE THREE MONTHS ENDED
                                                      --------------------------
                                                      MARCH 26,      MARCH 27,
                                                         1999           1998
                                                      --------        --------
                                                              (UNAUDITED)
<S>                                                <C>                  <C>                   
NET SALES                                             $102,200         $90,665
                                                                       
COST OF SALES                                           78,985          71,614
                                                       -------          ------
                                                                       
  Gross Profit                                          23,215          19,051
                                                                       
SELLING AND ADMINISTRATIVE EXPENSES                     16,204          13,261
                                                       -------          ------
                                                                       
  Operating Income                                       7,011           5,790
                                                                       
INTEREST EXPENSE                                         1,522           1,613
                                                                       
OTHER (INCOME) EXPENSE                                    (348)           (511)
                                                       -------          ------
                                                                       
  Income Before Income Taxes                             5,837           4,688
                                                                       
PROVISION FOR INCOME TAXES                               2,276           1,829
                                                       -------          ------
                                                                       
  Income From Continuing Operations                      3,561           2,859
                                                                       
  Income From Discontinued Operations                                  
  - Net Of Applicable Income Taxes                        ----             747
                                                                       
                                                       -------          ------
NET INCOME                                            $  3,561         $ 3,606
                                                       =======          ======
                                                                       
                                                                       
EARNINGS PER SHARE - BASIC                                             
                                                                       
INCOME FROM CONTINUING OPERATIONS                     $   0.18            0.14
                                                                       
INCOME FROM DISCONTINUED OPERATIONS                       ----            0.04
                                                                       
                                                       -------          ------
NET INCOME                                            $   0.18         $  0.18
                                                       =======          ======
                                                                       
                                                                       
EARNINGS PER SHARE - DILUTED                                           
                                                                       
INCOME FROM CONTINUING OPERATIONS                     $   0.17         $  0.13
                                                                       
INCOME FROM DISCONTINUED OPERATIONS                       ----            0.04
                                                                       
                                                       -------          ------
NET INCOME                                            $   0.17         $  0.17
                                                       =======          ======
</TABLE>                                                               
                                                                         
                                                                         
                                  Page 3 of 14
<PAGE>   4
                               JASON INCORPORATED
                                 BALANCE SHEETS

                             (Dollars in Thousands)
                             ----------------------


<TABLE>
<CAPTION>
                                                  MARCH 26,        DECEMBER 25,
                                                     1999              1998
                                                  ---------        ------------
                                                 (Unaudited)
<S>                                              <C>               <C>
ASSETS
Current Assets
  Cash And Cash Equivalents                       $   2,515           $  30,676
  Accounts Receivable - Net                          54,649              46,558
  Inventories                                        44,917              46,368
  Deferred Income Taxes                               5,663               5,663
  Other Current Assets                                6,078               4,732
                                                   --------            --------
    Total Current Assets                            113,822             133,997
                                                   --------            --------

Property, Plant and Equipment
  Cost                                              178,902             172,965
  Less - Accumulated Depreciation                   (83,203)            (80,268)
                                                   --------            --------
    Net Property, Plant and Equipment                95,699              92,697
                                                   --------            --------
                                                          0                   0
Intangible Assets - Net                              86,290              70,421
Other Assets                                          1,333               2,066
                                                   --------            --------
                                                   $297,144            $299,181
                                                   ========            ========


LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
  Current Portion of Long-Term Debt                $ 11,155            $ 29,947
  Accounts Payable                                   29,490              26,557
  Accrued Compensation And Employee Benefits         14,630              15,942
  Accrued Interest                                    1,590               1,059
  Accrued Income Taxes                                2,508               1,551
  Other Current Liabilities                          13,587              13,849
                                                   --------            --------

    Total Current Liabilities                        72,960              88,905

Revolving Loan                                       17,600         
Other Long-Term Debt                                 58,483              62,849
Deferred Income Taxes                                13,016              15,345
Other Long-Term Liabilities                           1,564               1,802
Postretirement Health And Other Benefits              6,247               6,337
                                                   --------            --------
    Total Liabilities                               169,870             175,238
                                                   --------            --------

Commitments and Contingencies                          ----                ----

SHAREHOLDERS' EQUITY
Common Stock And Additional
  Contributed Capital                                35,691              35,556
Retained Earnings                                    91,664              88,103
Accumulated Other Comprehensive Income (Loss)           (81)                284
                                                   --------            --------

    Total Shareholders' Equity                      127,274             123,943
                                                   --------            --------
                                                  $ 297,144           $ 299,181
                                                   ========            ========
</TABLE>

                                  Page 4 of 14
                                        
<PAGE>   5
                               JASON INCORPORATED
                            STATEMENTS OF CASH FLOWS
                             (DOLLARS IN THOUSANDS)

<TABLE>
<CAPTION>
                                                                                             FOR THE THREE MONTHS ENDED
                                                                                           -----------------------------
                                                                                            MARCH 26,          MARCH 27,
                                                                                               1999               1998
                                                                                            ---------          ---------
                                                                                                    (UNAUDITED)

<S>                                                                                         <C>                 <C>               
CASH FLOWS FROM OPERATING ACTIVITIES
  Income From Continuing Operations                                                         $   3,561           $  2,859
  Adjustments To Reconcile Income From Continuing Operations To Net Cash
   Provided By Operation Activities Of Continuing Operations:
      Depreciation                                                                              3,972              3,258
      Amortization                                                                                851                811
      Deferred Income Taxes                                                                    (2,329)             2,189
    Increase (Decrease) In Cash, Excluding Effects Of
    Acquisitions, Due To Changes In:
      Accounts Receivable                                                                      (7,865)            (7,259)
      Inventories                                                                               1,170               (299)
      Other Current Assets                                                                     (1,334)            (3,298)
      Accounts Payable                                                                          3,429              1,416
      Accrued Compensation And Employee Benefits                                                 (263)              (819)
      Accrued Interest                                                                            531                789
      Accrued Income Taxes                                                                        957              1,606
      Other, Net                                                                               (1,394)               595
                                                                                             --------           --------
        Total Adjustments                                                                      (2,275)            (1,011)
                                                                                             --------           --------

Net Cash Provided By Operating Activities Of Continuing Operations                              1,286              1,848

Net Cash Provided By Operating Activities Of Discontinued Operations                                                 618
                                                                                             --------           --------

Net Cash Provided By Operating Activities                                                       1,286              2,466
                                                                                             --------           --------

CASH FLOWS FROM INVESTING ACTIVITIES

      Acquisition Of Property, Plant And Equipment                                             (4,505)            (3,692)
      Disposal Of Property, Plant and Equipment, Net                                               45              1,133
      Other, Net                                                                                  (25)               161
                                                                                             --------           --------
Net Cash Provided (Used) For Investing Activities, Excluding Acquisitions                      (4,485)            (2,398)
                                                                                             --------           --------

Net Cash Provided (Used) Before Financing Activities, Excluding Acquisitions                   (3,199)                68

Acquisition Of Net Assets, Net Of Cash Acquired                                                (20,605)           (16,072)
                                                                                             --------           --------

Net Cash Provided (Used) Before Financing Activities                                          (23,804)           (16,004)
                                                                                             --------           --------

CASH FLOWS FROM FINANCING ACTIVITIES

      Proceeds From Revolving Loan                                                             26,175             39,942
      Repayments Of Revolving Loan                                                             (8,575)           (25,595)
      Repayments Of Convertible Notes                                                         (17,057)               ---
      (Repayments) Proceeds Of Other Long-Term Debt, Net                                       (5,035)               218
      Proceeds From Issuance Of Common Stock                                                      135                 50
                                                                                             --------            -------
Net Cash (Used) Provided By Financing Activities                                               (4,357)            14,615
                                                                                             --------            -------

Net Increase (Decrease) In Cash And Cash Equivalents                                          (28,161)            (1,389)
      Cash And Cash Equivalents, Beginning Of Period                                           30,676              4,453
                                                                                             --------            -------

      Cash And Cash Equivalents, End Of Period                                              $   2,515            $ 3,064
                                                                                             ========             ======

      Cash Paid For:

      Interest                                                                                  1,041              1,236
      Income Taxes                                                                              3,547                662
</TABLE>

                                  Page 5 of 14
<PAGE>   6
                               JASON INCORPORATED
                         NOTES TO FINANCIAL STATEMENTS


NOTE 1 - BASIS OF FINANCIAL STATEMENTS

The Company was incorporated in November 1985 and operates in two primary
business segments: motor vehicle products and industrial products. Motor vehicle
products include the manufacture and marketing of nonwoven acoustical
insulation, dielectric padding and other interior trim products primarily for
the automotive industry but also for furniture and industrial uses, plus seating
products for motorcycles, construction, agricultural and lawn/turf care
equipment. Industrial products include the manufacture and marketing of
industrial brushes, buffing wheels and compounds used by manufacturers to finish
a wide variety of manufactured products, plus the manufacture and marketing of
components such as precision stampings, wire form components and expanded metal
products.

The financial statements at March 26, 1999 and March 27, 1998 and for the three
month periods then ended are unaudited, however, in the opinion of management,
all adjustments (consisting only of normal recurring accruals) necessary for a
fair presentation of the financial position at these dates and the results of
operations and cash flows for these periods have been included. The results for
the three month period ended March 26, 1999 is not necessarily indicative of the
results that may be expected for the full year or any other interim period.

NOTE 2 - ACQUISITIONS / DIVESTITURES

On June 5, 1998, the Company completed the sale of its power generation business
to a management led group backed by Saw Mill Capital L.L.C. As such, the
accompanying consolidated financial statements and related notes have been
reclassified to reflect the power generation businesses as discontinued
operations. Net cash proceeds from the sale approximated $30 million; there was
no gain or loss on the sale. Sales and operating profit of the power generation
businesses for the period ended March 27, 1998 were $30.2 million and $1.6
million, respectively.

On February 9, 1999, the Company completed the acquisition of Sealeze
Corporation for approximately $18.6 million. Sealeze is a major producer of
strip brushes for industrial and consumer applications and has been integrated
into the Company's industrial products segment.

On February 3, 1999, the Company completed the acquisition of the acoustical
insulation manufacturing and molding operations of Lear Corporation based in
Colne, England for approximately $2 million. This acquisition further expands
Jason's European automotive capabilities.

On October 25, 1998, the Company acquired the remaining 49% minority interest in
Suroflex GmbH, a German manufacturer of acoustical insulation products for the
automotive industry, for approximately $2.5 million. In October 1996, the
Company made its initial majority investment in Suroflex. This acquisition
allows Jason and Suroflex to serve their U.S. and European customers on a
worldwide basis.

On March 13, 1998, the Company completed the acquisition of Power Brushes Ltd.
for approximately $16.9 million, including cash and acquisition costs, plus the
assumption of approximately $10.3 million of debt. Brushes International Ltd., a
wholly-owned 

                                  Page 6 of 14
<PAGE>   7
subsidiary of Power Brushes Ltd., is one of the largest producers of industrial
power brushes in Europe. This business has been combined with the Company's
industrial brush business, Osborn Manufacturing, to form Osborn International,
the largest producer of industrial power brushes in the world.


NOTE 3 - INVENTORIES - Inventories are stated at the lower of cost (first-in,
first-out) or market and consisted of the following (in thousands of dollars):




<TABLE>
<CAPTION>
                                MARCH 26,      DECEMBER 25,
                                   1999            1998
                               ----------      ------------
                               (Unaudited)

<S>                            <C>               <C>
Raw Materials                     $21,737           $19,881

Work-In-Process                     6,336             5,817

Finished Goods                     16,844            20,670
                                  -------           -------

                                  $44,917           $46,368
                                  =======           =======
</TABLE>


                                  Page 7 of 14
<PAGE>   8
NOTE 4 - EARNINGS PER SHARE

Basic earnings per share is computed by dividing net income available to common
shareholders by the weighted-average number of common shares outstanding during
the period. Diluted earnings per share is computed by giving effect to all
dilutive potential common shares. A reconciliation of the income (numerator) and
shares (denominator) used in the computations of basic and diluted earnings per
common share from continuing operations, respectively, is as follows
(unaudited):


<TABLE>
<CAPTION>
                                                                  FOR THE THREE MONTHS ENDED MARCH 26, 1999
                                                                  -----------------------------------------
                                                            Income              Shares            Per Share
                                                          (Numerator)        (Denominator)          Amount
                                                          -----------        -------------          ------
<S>                                                        <C>                <C>                 <C>    
BASIC EARNINGS PER COMMON SHARE
       Income from continuing operations                   $3,561,000         20,360,294             $.18    
                                                                                                  ----------
EFFECT OF DILUTIVE SECURITIES
       Options                                                 --                342,586
                                                           ----------         ----------
DILUTED EARNINGS PER COMMON SHARE
       Income from continuing operations
         plus assumed conversions                          $3,561,000         20,702,880             $.17
                                                           ----------         ----------          ----------
</TABLE>


<TABLE>
<CAPTION>
                                                                  FOR THE THREE MONTHS ENDED MARCH 27, 1998
                                                                  -----------------------------------------    
                                                            Income              Shares              Per Share
                                                          (Numerator)        (Denominator)           Amount
                                                          -----------        -------------           ------
<S>                                                        <C>                <C>                    <C> 
BASIC EARNINGS PER COMMON SHARE
       Income from continuing operations                   $2,859,000         20,238,718             $.14
                                                                                                  ----------
EFFECT OF DILUTIVE SECURITIES
       Options                                                 --                522,070
       Convertible notes                                      184,220          1,516,182
DILUTED EARNINGS PER COMMON SHARE                          ----------         ----------
       Income from continuing operations
         plus assumed conversions                          $3,043,220         22,276,970             $.13
                                                           ----------         ----------          ----------
</TABLE>



The impact of the assumed conversion of the $17,057,000 convertible notes, which
bear interest at 7%, was included within the earnings per share calculations
only for the three month period ended March 27, 1998 since these notes were
repaid on January 3, 1999.

NOTE 5 - COMPREHENSIVE INCOME

The Company recognizes, in accordance with Statement of Financial Accounting
Standards ("SFAS") No. 130, "Reporting Comprehensive Income," certain items
under accounting principles as components of comprehensive income to be reported
in an annual financial statement that is displayed with the same prominence as
other financial statements.

Total Comprehensive Income totaled $3,196,000 and $4,184,000 for the three
months ended March 26, 1999 and March 27, 1998, respectively. Total
Comprehensive Income for the three months ended March 26, 1999 is comprised of
net income of $3,561,000 and 

                                  Page 8 of 14
<PAGE>   9
Other Comprehensive Income (Loss) of ($365,000). Total Comprehensive Income for
the three months ended March 27, 1998 is comprised of net income of $3,606,000
and Other Comprehensive Income (Loss) of $578,000. Other Comprehensive Income
(Loss) is comprised entirely of foreign currency translation adjustments.

NOTE 6 - SEGMENT INFORMATION

The Company's six business units have separate management teams and
infrastructures that offer different products and services. The business units
have been aggregated into two reportable segments (motor vehicle products and
industrial products) since the long term financial performance of these segments
is affected by similar economic conditions. The Company evaluates performance
based on operating earnings of the respective business units. Segment detail is
summarized as follows (in thousands of dollars):

<TABLE>
<CAPTION>
                                                        MARCH 26,         MARCH 27,
                                                          1999               1998
                                                        ---------         ---------
                                                              (Unaudited)
<S>                                                   <C>                <C>         
Net Sales:
         Motor vehicle products                       $   55,967        $    52,974
         Industrial products                              46,233             37,691
                                                      ----------        -----------
                                                      $  102,200        $    90,665
                                                      ==========        ===========

Operating Income:
         Motor vehicle products                       $    5,569        $     4,725
         Industrial products                               2,145              1,838
                                                      ----------        -----------
                                                           7,714              6,563
         Corporate and other expenses                       (703)              (773)
                                                      ----------        -----------
                                                      $    7,011        $     5,790
                                                      ==========        ===========

Identifiable Assets:
         Motor vehicle products                       $  129,190        $   122,636
         Industrial products                             159,809            139,080
         Corporate                                         8,145             11,839
         Net assets of discontinued operations               ---             31,380
                                                      ----------        -----------
                                                      $  297,144        $   304,935
                                                      ==========        ===========
</TABLE>


                                  Page 9 of 14
<PAGE>   10
                               JASON INCORPORATED
                      MANAGEMENT'S DISCUSSION AND ANALYSIS
                OF RESULTS OF OPERATIONS AND FINANCIAL CONDITION


On June 5, 1998, the Company completed the sale of its power generation business
to a management led group backed by Saw Mill Capital L.L.C. As such, the
accompanying consolidated financial statements and related notes have been
reclassified to reflect the power generation businesses as discontinued
operations. Net cash proceeds from the sale approximated $30 million; there was
no gain or loss on the sale. Sales and operating profit of the power generation
businesses for the period ended March 27, 1998 were $30.2 million and $1.6
million, respectively.

RESULTS OF OPERATIONS

Three months ended March 26, 1999 compared to the three months ended March 27,
1998:

Sales from continuing operations for the three months ended March 26, 1999
increased by 13% from $90,665,000 for the three months ended March 27, 1998 to
$102,200,000. Sales of motor vehicle products increased by 6% from $52,974,000
to $55,967,000. Sales of industrial products increased by 23% from $37,691,000
to $46,233,000.

The increase in the Company's motor vehicle products sales was the result of
increases in the automotive products business. The Company's automotive products
business was up 12% in the first quarter of 1999 compared to the prior year. The
U.S. automobile industry built 7.7% more vehicles in the first quarter of 1999
than it did last year. In addition, sales of the Company's Marabond  moldable
insulation product and thermoformed door inserts improved in the first quarter
of 1999 compared to the prior year. The inclusion of the recently acquired
Colne, England acoustical insulation manufacturing and molding operations for
part of the first quarter of 1999 had the effect of increasing automotive
product sales by 2%. The Company's seating products business was down 6% in the
first quarter of 1999 compared to the prior year. This was primarily the result
of a decrease in Harley-Davidson parts and accessories business due to an
adjustment in inventory levels.

The increase in Industrial products sales in the first quarter of 1999 compared
with last year was primarily the result of the inclusion of the recent
acquisitions of Power Brushes Ltd. and Sealeze Corporation.

Operating income improved in the first quarter of 1999 from $5,790,000 in the
first quarter of 1998 to $7,011,000.

Operating income for the motor vehicle products segment improved from $4,725,000
in the first quarter of 1998 to $5,569,000 due primarily to improved
profitability in the automotive products business, a result of greater capacity
utilization, a more profitable product mix and improved operating efficiencies.
This more than offset reduced profitability in the seating business due to a mix
of lower margin products that resulted from lower motorcycle sales and higher
lawn and turf care sales.

Operating income for the industrial products segment increased from $1,838,000
in the first quarter of 1998 to $2,145,000. This increase in operating income
was primarily the result of the inclusion of the recent acquisitions of Power
Brushes Ltd. and Sealeze Corporation.


                                 Page 10 of 14
<PAGE>   11
Corporate expenses for the first quarter of 1999 were $703,000 compared to
$773,000 last year. This decrease is primarily due to a decrease in management
incentive compensation.

Interest expense from continuing operations decreased in the first quarter of
1999 from $1,613,000 in the first quarter of 1998 to $1,522,000 due to lower
debt levels which is a result of cash flow from operations over the past year
and the proceeds received from the sale of the power generation businesses. The
decrease in other income in the first quarter of 1999 compared to last year is
primarily a result of a one time gain on the sale of assets last year.

The Company's effective income tax rate for the first quarter of 1999 was 39%
which is the same as the rate for the first quarter of 1998.

FUTURE ACCOUNTING CHANGES

In June 1998, the FASB issued SFAS No. 133, "Accounting for Derivative
Instruments and Hedging Activities." This statement requires all derivative
instruments to be recorded in the Consolidated Balance Sheets at their fair
value. Changes in fair value of derivatives are required to be recorded each
period in current earnings or other comprehensive income, depending on whether
the derivative is designated as part of a hedge transaction and if it is, the
type of hedge transaction. This statement is effective for all fiscal quarters
of fiscal years beginning after June 15, 1999. The effect of adoption of this
statement on the Company's earnings or statement of financial position is
expected to be minimal.

LIQUIDITY AND CAPITAL RESOURCES

During the first quarter of 1999, the Company satisfied the capital requirements
of its operations with internally generated funds. For the foreseeable future,
the Company believes it will generate funds from operations sufficient to meet
the capital requirements of its existing operations. In March 1999, the Company
entered into a new $50 million credit agreement with its two banks. As of March
26, 1999, the Company had available unused borrowing capacity of $29.4 million
under this bank revolving loan facility. During the first quarter of 1998, the
Company also satisfied the capital requirements of its operations with
internally generated funds.

During the first quarter of 1999, working capital decreased by $4,230,000 from
$45,092,000 at December 25, 1998, to $40,862,000 at March 26, 1999. This
decrease in working capital was the result of a decrease in cash and cash
equivalents which were used to partially fund the first quarter 1999
acquisitions of the Colne, England acoustical insulation manufacturing and
molding operations and Sealeze Corporation.

In the first quarter of 1999 and 1998, the Company made capital expenditures of
$4,505,000 and $3,692,000, respectively. The major first quarter 1999
expenditures were in the motor vehicle products segment for equipment at
Janesville Products and Sackner to support new programs and to improve
efficiency. The major first quarter 1998 expenditures were in the motor vehicle
products segment for equipment to support the conversion to cellular
manufacturing at Milsco. No significant commitments are outstanding as of March
26, 1999.


                                 Page 11 of 14
<PAGE>   12
SEASONALITY

U.S. auto makers traditionally shut down for the annual model changeover in the
third quarter. In addition, adjustments to production schedules are made
throughout the year based on retail auto sales and the level of dealer
inventories. These seasonal patterns affect the Company's motor vehicle products
operations most significantly but also have somewhat of an impact on industrial
products due to the effect on automotive suppliers which use the Company's
components and finishing products.

YEAR 2000 ISSUES

The Company's State of Readiness - The Company's main financial and
manufacturing hardware and software systems have been tested and are now
believed to be year 2000 compliant. This was accomplished primarily through
systems upgrades and maintenance performed over the last few years to enhance
functionality of the systems, not solely to achieve year 2000 compliance. The
only systems that remain to be upgraded for year 2000 are certain ancillary,
mostly PC based, interface systems used for payroll, shop floor control and
report writing functions. Year 2000 compliance for these systems is ongoing and
is expected to be completed by mid 1999. Major customers and suppliers have been
surveyed and to date the Company has not been made aware of significant year
2000 issues that would materially affect its business.

Costs to Address the Company's Year 2000 Issues - The majority of the Company's
year 2000 issues were corrected either through systems upgrades required for
other business purposes or normal maintenance contracts. Therefore, these
improvements have not resulted in costs significantly incremental to non-year
2000 planned information systems activities. The estimated costs to correct the
remaining ancillary systems still not compliant are not expected to exceed
$200,000.

Risks to the Company for Year 2000 Issues - With regard to systems under the
Company's control, management does not believe that the Company has significant
exposure to the year 2000 issue since, if necessary, systems are capable of
accepting manually entered data. The believed worst case scenario is that the
Company would have to revert back to certain manual systems for a small portion
of its systems, for example, shop floor labor collection and certain internal
reporting functions. Our customers and vendors are at various stages of
compliance, but management is not aware of significant year 2000 issues that
would materially affect the Company's business with them. The Company will
continue to monitor year 2000 compliance with its customers and vendors
throughout 1999, but will be unable to achieve the same degree of certainty that
it has achieved with internal systems.

The Company's Contingency Plans - By the middle of 1999, the Company expects to
be fully year 2000 compliant. To the extent that it has minor internal systems
that are not year 2000 compliant by mid-year, the Company will have time to
implement manual systems by year end 1999 which management believes will
significantly reduce the financial risk to the Company.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Company is exposed to market risk stemming from changes in foreign exchange
rates, interest rates and commodity prices. Changes in these factors could cause
fluctuations in earnings and cash flows. In the normal course of business,
exposure to interest rates is managed by fixing interest rates on the majority
of the Company's long-term debt. Fluctuation in commodity prices, for example
steel and cotton cloth, are 


                                 Page 12 of 14
<PAGE>   13
managed by strategic purchasing which generally provides the time necessary to
allow for price increases to customers, where appropriate. In rare situations
where commitments are made for extended periods (more than 60 days), outside of
functional currencies, for example, a commitment to purchase European equipment
for use in a U.S. plant which will take six months to deliver, exposure is
managed by entering into hedging transactions authorized under Company policies
that place controls on these activities. Hedging transactions involve the use of
derivative financial instruments and are used only where there is an underlying
exposure; not for trading or speculative purposes. At March 26, 1999 there were
no outstanding hedging transactions.

Foreign Operations - The Company has significant foreign operations, for which
the functional currencies are denominated primarily in German Marks and British
Pounds and to a lesser extent, Canadian Dollars, Swedish Kronor, French Francs,
Mexican Pesos, Brazilian Reals, Chinese Renminbi, and Portuguese Escudos. As the
values of the currencies of the foreign countries in which the Company has
operations increases or decreases relative to the U.S. Dollar, the sales,
expenses, profits, assets and liabilities of the Company's foreign operations,
as reported in the Company's Consolidated Financial Statements, increase or
decrease, accordingly. The Company's primary method of reducing this exposure is
to approximately balance current assets and liabilities within each functional
currency. The Company does not use derivative financial instruments to hedge
this exposure. Because the Company has significant operations across member
countries of the European Monetary Union, the introduction of the Euro on
January 1, 1999 simplified the management of foreign exchange exposure by
aggregating the assets and liabilities of several currencies that previously had
to be managed individually.

EURO CONVERSION

On January 1, 1999, member countries of the European Monetary Union (EMU) began
a three-year transition from their national currencies to a new common currency,
the "Euro". In the first phase, the permanent rates of exchange between the
members' national currency and the Euro has been established and monetary,
capital, foreign exchange, and interbank markets will be converted to the Euro.
National currencies will continue to exist as legal tender and may continue to
be used in commercial transactions. By January 2002, Euro currency will be
issued and by July 2002, the respective national currencies will be withdrawn.
The Company has operations in member countries of the EMU and, accordingly, has
established action plans that are continuing to be implemented to address the
Euro's impact on information systems, currency exchange rate risk, taxation,
contracts, competition and pricing. Based on its current assessment, management
believes that the costs of the Euro conversion will not have a material impact
on the operations, cash flows or financial condition of the Company.

FORWARD-LOOKING STATEMENTS

This report contains certain statements as to the Company's belief, expectation
or anticipation regarding future developments. Such statements constitute
forward-looking statements and are subject to certain risks and uncertainties
that could cause actual future results and developments to differ materially
from those currently projected. Such risks and uncertainties include, but are
not limited to, changes in capital expenditure requirements, the ability of the
Company and its suppliers and customers to address Year 2000 issues and general
economic conditions in the Company's market segments.


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<PAGE>   14
                                     PART II

                                OTHER INFORMATION


ITEM 1            Legal Proceedings - None

ITEM 2            Changes in Securities - None

ITEM 3            Defaults Upon Senior Securities - None

ITEM 4            Submission of Matters to a Vote of Security Holders - None

ITEM 5            Other Information - None

ITEM 6            (a)  Financial Data Schedule
                  (b)  Reports on Form 8-K - None



                                   SIGNATURES



Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

                                            JASON INCORPORATED (Registrant)


                                            by ________________________
                                            Mark Train
                                            President
                                            (Chief Financial Officer)

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