The -bd switch tells BitGen to execute data2mem and initialize the noted block RAM with the contents of the MEM or ELF file.
In Project Navigator, if an ELF, MEM or BMM file is added to the top level of the project, the -bd switch is added to BitGen command with the name of the ELF file. However, if the attached MEM file has a capitalized extension (.MEM) instead of a lower-case extension (.mem), the -bd switch is not added.
Project Navigator does not accept MEM files with upper-case extension (.MEM).
Rename the MEM file with a lower-case extension and re-add to the Project Navigator Project.