Each folder in the Document Template Directories requires to have a Default.dot file or a Default.dotx if you have run the conversion wizard.
The reason for this is that each category can have a starting point for MS Word documents. When adding a New template using the New button the Default.dot/Default.dotx file is used as the basis for the new template.
If you do not have this file you will experience a "File not found" error when adding a new template.
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