Recovery agent filing criminal case

Hello! We are a pvt. ltd company 5 yrs old. When we started the company, one of our close relative (my wife's own brother) liked the idea and wanted to invest in the company and develop software in lieu of shares. He had agreed to invest money as well as develop software for our company. We even signed an agreement on plain paper. He remitted his installments (from abroad) for 2 years and then stopped saying his condition did not allow further investments. He then stopped software development after working for 1 year. We had orally agreed to issue shares on completion of all his installments. Now he started threatening with FEMA compliance which i had not done. He also started asking for my personal IT return against amounts he had remitted into my personal account which i then transferred to the company account. He then raised a very high invoice for his software developments which was non functional. We told him that we cannot pay for his software as it is not working. Then he started asking for refund of all his investments. We told him to cancel the agreement and agree to a settlement amount net of our losses and since he is a close family we will try to refund the amount in installments. but if we do not agree to this, then we shall issue shares to him. To this he canceled the agreement on email and asked our losses but when we quoted him, he went silent. No reverts on email reminders too for 3 months. Then to close our books of accounts, we sent him an email that we have adjusted his advances against our losses and closed the books of accounts. We then came to know from another relative that he has hired a recovery agency who in turn has hired a criminal lawyer who will file a criminal compliant against me (a director of the company) and the lawyer has told him that he will get a non-bailable arrest warrant against me and then the recovery agency will contact me to pay up to close the issue. My questions are 1) Can they file a criminal case for this? if yes, what charges can he levy on me? 2) Can they file a case against the director of the company? 3) How should i prepare myself till the time I get the court notice?