Krafton Extends ‘Subnautica 2’ Bonus Period, Is Sued by Founders | Company Business News

(Bloomberg) — South Korean video game publisher Krafton Inc. plans to extend the schedule for a potential bonus payout at its subsidiary Unknown Worlds after delaying the highly anticipated survival game Subnautica 2 until next year. 

About 40 employees at Unknown Worlds were eligible to share a $25 million bonus, contingent upon the studio hitting certain revenue targets by the end of 2025, with a possible short-term extension. When Krafton said earlier this month that it planned to push back the game’s release, employees feared that it wouldn’t be possible to hit those targets and that their potential earnings would disappear.

Now, that schedule has been extended an additional year, according to people familiar with the events at the studio and documentation seen by Bloomberg. Krafton also said it would advance a portion of the studio’s projected 2026 profit-sharing bonus pool, which is independent from the bonus, to all Unknown Worlds employees this year.

The issues around Subnautica 2 are at the center of a battle between Krafton and the former leadership team of Unknown Worlds — Chief Executive Officer Ted Gill and founders Charlie Cleveland and Max McGuire — who were fired in early July.

Krafton purchased Unknown Worlds in 2021 for $500 million with an additional $250 million to be paid in 2026, depending on the company’s performance under an earnout agreement.  Of that, 10% was earmarked for staff who were there at the time, according to paperwork seen by Bloomberg. The roughly 40 employees each received checks of varying amounts at the closing and in the two years that followed, totaling $50 million, and were due to receive upwards of $25 million if the company hit those revenue targets. Each employee was told they would get a different sum, with most in the six or seven figures. 

Gill and the leadership group, who were due to receive the bulk of the remaining $225 million, had also said that they would distribute an unspecified amount to employees who weren’t eligible for the earnout, although that isn’t specified in the paperwork.

On July 10, the former leadership group filed a breach of contract complaint against Krafton in Delaware Chancery Court. As of Tuesday, the complaint remained sealed.

One main point of contention between the two parties is whether Subnautica 2, the sequel to a surprise 2018 hit, was ready for an early access release this year. The leadership group and Unknown Worlds developers who spoke to Bloomberg said the game was in good shape for early access, a model in which games are sold while in active development so that fans can offer feedback during the process.

But since last week, Krafton has sent several statements suggesting that the game wasn’t ready and that the studio’s co-founders had neglected their duties, which “resulted in repeated confusion in direction and significant delays in the overall project schedule,” according to the company.

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