Stencils

28.  Texture Type:  Image
  •  Properties menu >> Texture button >> Type >> Image or Movie
29.  Open the bottom texture 
  • Properties menu >> Texture button >> Image tab >> Open
Note:
  • For this tutorial, I am using a texture named Mud.png

  • Download: Mud.png

30.  Mapping Coordinates: Generated
  • Properties menu >> Texture button >> Mapping tab >> Coordinates: Generated
Note:
  • You don't have to use Mapping Coordinates: Generated

  • You can map the texture to the game object anyway you want