This version of links manager allows the uploading of a banner image, if no banner image is uploaded then a default image will be used.
If you don't a banner image at all, create a transparent gif image name links_default.gif and upload it to images/links_image on your server.
You can leave Configuration>Links Mangaer there is a 'Display Link Banner Image' option set to 1.
Note you may have to edit you links admin -> extras -> links
in the image URL: field just add links_image/links_default.gif
Hope this helps
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