Here is what it says at the end about .lit files-----------Where can I find ebooks to read?
Most public domain books can be downloaded from Project Gutenberg. If you like science fiction, Baen have many of their books available for free download. (Choose the LIT format.) Even more Baen books are available at Firth Imperium.
If you are buying ebooks, be sure they are not infected with DRM, because Ebook Reader Pro won't be able to read them and Catalyst won't be able to convert them. If you do have DRMed books, you may be able to use Convert LIT or MobiDeDRM to clean them (unless removing DRM is illegal in your country).