Thanks, here is the complete code for skin1/customer/categories.tpl, modified to fit my template
Code:
{* $Id: categories.tpl,v 1.26 2005/11/17 06:55:37 max Exp $ *}
{if $active_modules.Fancy_Categories ne ""}
{include file="modules/Fancy_Categories/categories.tpl"}
{assign var="fc_cellpadding" value="0"}
{else}
{if $config.General.root_categories eq "Y"}
{foreach from=$categories item=c}
<font class="CategoriesList"><a href="home.php?cat={$c.categoryid}" class="VertMenuItems">{$c.category}</a></font>{assign var=in value=$c.categoryid}
{foreach from=$allsubcategories.$in item=c }<br />
» <a href="home.php?cat={$c.categoryid}" class="CategoriesList3">{$c.category}</a>
{/foreach}<br>
{/foreach}
{else} {foreach from=$subcategories item=c key=catid}
<font class="CategoriesList"><a href="home.php?cat={$catid}" class="VertMenuItems"><li>{$c.category}
</li></a></font><br />
{/foreach}
{/if}
{/if}