Theft and Larceny: Theft from Employer

My question involves criminal law for the state of: PENNSYLVANIA
Ok well the whole situation is confusing but I will explain as much as I can.
I had a drug problem, stole money from my former employer. My employer found out in October of 2010. Becaue of our prior friendship he decided to make a contract for repayment. I had given him back the car he had helped purchase for me (I still owed some money for) and agreed to pay him with my income tax return. The end date for our contract is March 31, 2011. (Which has yet to arrive)

He e-mailed me about meeting him to get my W2's. I said I did not want to meet him and that he needs to mail them to me because he cannot withhold them from me. Well I guess he didn't like that idea and replied that he would be taking my W2's to court and giving them to the court because he wants his money.

Without my W2's I cannot file my taxes, or repay him. Can he file theft charges even though we have a contract that has not expired? And can he still file theft charges even though he has known for a few months about the theft. He has always been able to reach me through e-mail, so I've never been avoiding correspondance.

Another reason he decided to go with a contract I think is because we somewhat had an affair and I don't think he wanted his wife to find out. He's foreign and had arranged marriage and their religion is very much against all of that. I think he also did not want me to report him for paying employees under the table or paying them cash and administering paystubs for the employees where the money went into his bank account. Basically he paid them cash, but they got a paystub saying they made a lesser hourly wage and did not receive the money from the check cause it was deposited into his bank account. I believe he did this so employees could still qualify for welfare and housing.

Any help or insight would be greatly appreciated!