Book contracts are a tricky business. Getting accepted by a publisher or agency willing to represent your book is elating. However, even when they seem on the up-and-up--even sometimes when they ARE legitimate--they can turn sour, as it did for one of my clients. The literary agency that had accepted his book ran out of money (but kept this a secret) and they simply stopped responding to his calls and emails. These types of situations are, unfortunately, the pitfalls of a business in flux, as print goes more and more to digital.
But don't be discouraged! Here's a great blog post about things to keep an eye out for when negotiating your own book contract. While it might not save your agency from going bankrupt, it may well signal you earlier on that it's time to get out of a contract before it drags on too long. I know that all sounds terrible, but forewarned is forearmed. Read this and be your own advocate. :)