pattern

1. Create a new file to work on in Adobe Illustrator. Make the file A3 size (portrait format).

2. File > Place > Select the just_pencil.psd file.
Make sure the pencil is selected by clicking on it with the Selection Tool (Black Arrow) 

3. Object >  Pattern > Make

4. Click DONE (just above the red line seen below).

5. Delete the pencil from the art board by clicking on it with the Selection Tool and pressing the backspace button or delete button on the keyboard.

6. Draw out a rectangle with the Rectangle Tool (select from the toolbox).

7. Make sure the Fill option is selected. Fill option here is show with the question mark. (The stroke option has the red diagonal).

8. Open the Swatches Panel (open from Window Menu at the top of the screen) if not shown.

9. Click on the icon of the pattern you have just created.

10. Save your work.