Open /templates/mg_themes/common/nav_quick_links.tpl

FIND
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<!--
<tr>
<th style="cursor: pointer; cursor: hand;" align="left">
<img src="{IMG_NAV_MENU_SPONSOR}" alt="Sponsors" title="Sponsors" />&nbsp;
<a href="javascript:void(0);" title="Sponsors" style="vertical-align: top;"><b>Sponsors</b></a>
</th>
</tr>
<tr>
<td class="row5">
<div id="sponsors" style="position: relative; padding-top: 0px; padding-bottom: 0px;">
<table class="forumline-no2" width="100%" cellspacing="0" cellpadding="2" border="0">
<tr>
<td width="8" align="left" valign="middle">{IMG_NAV_MENU_SEP}</td>
<td class="genmed" align="left"><a href="http://www.mightygorgon.com/">Mighty Gorgon</a></td>
</tr>
</table>
</div>
</td>
</tr>
-->

REPLACE WITH

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<tr class="forumline">
<th style="cursor:pointer;cursor:hand;" align="left" onclick="ShowHide('sponsor','sponsor2','sponsor');">
<table cellspacing="0" cellpadding="0" border="0">
<tr>
<td><img src="{IMG_NAV_MENU_SPONSOR}" alt="" /></td>
<td><a href="javascript:void(0)" title="Sponsor"><b>Sponsor</b></a></td>
</tr>
</table>
</th>
</tr>
<tr>
<td>
<div id="sponsor2" style="display: yes; position: relative;">
<table border="0" cellpadding="0" cellspacing="4" width="100%" class="forumline-no2">
<tbody>
<tr>
<td class="genmed" align="center">
-----------------> AD HERE <-----------------
</td>
</tr>
</tbody>
</table>
</div>
</td>
</tr>


If you want to replace the img used, you have to edit this part of the code

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<img src="{IMG_NAV_MENU_SPONSOR}" alt="" />


With this code always show the sponsor, in order to show and hide it like the rest of menu, to make this change code.

FIND
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<div id="sponsor2" style="display: yes; position: relative;">

REPLACE WITH
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<div id="sponsor" style="display: none; position: relative;">