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I'm using Illustrator CS6 to substract text from a shape. I tried Create Outlines after typing my text, then using Minus from Pathfinder to substract it from the shape. But then I get this result:

enter image description here

Please tell me why it get distorted like that. Any help appreciated!

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You need to "bake in" the Round Corners Effect before using Pathfinder.

Select the rectangle, and choose Object > Expand Appearance from the menu... Then use Pathfinder to subtract the text.

The issue is that the round corners effect is being applied to the counters (holes) created by the text as well as the outside corners. By expanding the appearance of the rectangle you remove the "effect" and leave the results the effect was achieving.

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