The frame is simply 4 pieces of 1" x 2" that will provide a surface to nail the panels to as well as some structure for the base. Performing this step after you cut the panels will give you a chance to adjust the frame dimensions according to the actual dimensions of the panels so that the panels will fit together nice and tight. Pay close attention to the first picture and how the joints are laid out. Be sure to either follow this method or draw out how you want your joints to line up so that you have a reference throughout the cutting process.
Determine the length you will need for piece 1 and 3 as shown in the first picture - let's call this "c"
Measure the actual dimension of the panel along piece 1 on the left hand side - let's call this "a"
Measure the actual dimension of the 1" side of the 1" x 2" board - let's call this "b"
c = a - (2 x b) - 1/2"
The 1/2" is two panel thicknesses.
Determine the length of piece 2 and 4
This is easier. Either measure the actual cut length of the 3' side of one of your 1' x 3' panels or simply lay the panel on the 1" x 2" board and mark it off.
Assemble the frame
Clamp the frame together as shown in the second picture. Use your framing square to check the corners. Drill pilot holes for the screws as shown in picture 3. These are required so that the frame pieces don't spit when you're driving in the screws. You'll also need to drill counterbores for the screw heads using a large drill bit so that the screw heads don't interfere with the panels.