<PAGE>

                   UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                                Washington, D.C. 20549

                                     FORM 10K-SB

/X/  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
     ACT OF 1934

                    For The Fiscal Year Ended DECEMBER 31, 1998

/ /  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
     EXCHANGE ACT OF 1934

        Date of Report (Date of Earliest Event Reported) JULY 6, 1999

                                 BRAINTECH, INC.
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              (Exact name of Registrant as specified in its charter)

        NEVADA                                                98-0168932
----------------------      ------------------------      -------------------
(State or jurisdiction      (Commission File Number)        (IRS Employer
of incorporation)                                         Identification No.)


       930 West 1st Street #102, North Vancouver, B.C., Canada, V7P 3N4
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                   (Address of Principal Executive offices)

Issuer's Telephone Number: (604) 988-6440

         Securities registered pursuant to section 12(b) of the Act:
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                                     None

          Securities registered pursuant to section 12(g) of the Act:
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                        Common Stock, $0.001 par value
                                (Title of Class)
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Check whether the registrant (1) has filed all reports required to be filed
by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the past
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            No   x
         -----         -----

Check if there is no disclosure of delinquent filers in response to Item 405
of Regulation S-B contained in this form, and no disclosure will be
contained, to the best of the registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form
10-KSB or any amendment to this Form 10-KSB. ____________

State issuer's revenues for the most recent fiscal year: $57,510

State the aggregate market value of the voting and non-voting common equity
held by non-affiliates, computed by reference to the closing price for
trading of the issuer's stock on the OTC-Bulletin Board as at July 6, 1999:
$8,113,137.

State the number of shares outstanding of each of the issuer's classes of
common equity, as of the latest practicable date:  34,771,333 Common shares,
par value $0.001, as at July 6, 1999.

                           Index to Exhibits on Page 44

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the Microsoft Corporation's Windows '95 platform.  The consortium will carry
on business through a private company called Concurrent Adaptive Recognition
Research Corp. ("Carr Corp.").  Each of the Company, Sideware Systems Inc.
and NetMedia Systems Inc. owns one-third of the shares of Carr Corp., subject
to adjustment for funds actually provided to Carr Corp. by each participant.
In addition, each member of the consortium has the right to use technology
developed by Carr Corp. to develop specified products.

     As at the date of this Annual Report Carr Corp. has not commenced
operation.

     On May 27, 1998, Grant Sutherland beneficially acquired 780,000 private
placement shares in the Company at price of $0.25 per share.

     On September 29, 1998 Grant Sutherland beneficially acquired 300,00
private placement shares in the Company at a price of $0.20 per share.

     Subsequent to the December 31, 1998, directors of the Company have
acquired the following private placement shares:

     -    Owen Jones beneficially acquired 1,000,000 shares at a price of $0.15.

     -    Grant Sutherland beneficially acquired 1,000,000 shares at a price of
          $0.15.


INDEX TO EXHIBITS

<TABLE>
<CAPTION>
NUMBER                               EXHIBIT
------                               -------
<S>      <C>
  3.1    Articles of Incorporation, dated February 27, 1987
  3.2    Articles of Amendment, dated July 14,1998
  3.3    Articles of Amendment, dated June 28, 1990
  3.4    Articles Of Amendment of the Company, dated February 8, 1993
  3.5    Articles of Amendment of the Company, dated April 6, 1993
  3.6    Articles of Amendment of the Company, dated December 6, 1993
  3.7    By-Laws of the Company
  4.1    Specimen Stock Certificate
 10.1    License Agreement between the Company and Willard W. Olson,
         dated January 5, 1995.
 10.2    Product Development Agreement between the Company and United
         Technologies Microelectronic Systems Inc., dated July 6, 1998.
 10.3    Manufacturing and Sales Agreement between the Company and
         United Technologies Microelectronic Systems Inc., dated July 6,
         1998.
 10.4    Operating Agreement between the Company and Sideware Systems
         Inc., dated November 1, 1995
 10.5    Worldwide Non-Exclusive License Agreement between the Company
         and NetMedia Systems Inc., dated November 2, 1995.
 10.6    Joint Venture Agreement by and among the Company, Sideware
         Systems Inc., and NetMedia Systems Inc., dated November 23,
         1995.
 10.7    Assignment of Lease and Modification of Lease Agreement dated
         August 17, 1998 between HOOPP Realty Inc., Techwest Management
         Inc., Sideware Systems Inc., and BrainTech, Inc.
 11.1    Computation of net loss per share
 21.1    Subsidiaries of the Registrant
 27.1    Financial Data Schedule for the Fiscal Year Ended December 31, 1997
 27.2    Financial Data Schedule for the Fiscal Year Ended December 31, 1998
</TABLE>


                                       44
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All of the above Exhibits with the exception of Exhibit 10.7, Exhibit 11.1,
Exhibit 27.1, and Exhibit 27.2 are already on file as a result of the Company
filing a Form 10-SB.

The Company did not file any reports on Form 8-K during the last quarter of
the period covered by this Annual Report.


                                       45
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                                   SIGNATURES

In accordance with Section 13 of the Securities Exchange Act of 1934, the
registrant caused this Annual Report to be signed on its behalf by the
undersigned, thereunto duly authorized.


Dated: July 6, 1999                BrainTech, Inc.


"Owen L.J. Jones"                  "W. Grant Sutherland"
-------------------                ----------------------------------
Owen L.J. Jones                    W. Grant Sutherland
Director                           Director
President and Chief                Chairman of the Board of Directors
Executive Officer                  Chief Financial Officer


                                       46