Problem using jpeg logo in html signature file

Hi
I have used Word to create a signature file that includes a jpeg company logo
with some other text and saved it as a web page file. I have set up Thunderbird
(version 2 alpha 1) to use this file but when I "compose" a new email the text of the signature file appears ok but an empty box appears where the logo should be with a little red diamond in the top left hand corner. If I try to send the message anyway a dialog box appears "Attaching image002.gif" but nothing more happens.
I have checked that the option in Thunderbird account settings for compose messages in html is ticked.
Thanks in advance for any help