You will need a foam block, the stencil template from the Cover the Night Digital Action Kit, some tape that will stick to both, and a knife. Scissors may also be helpful. The foam block I used came from some packaging. My parents tried to throw it out, but I saved it because I knew I could find a use for it. It happens to have three holes in the back that make a passable handle.
Warning: Don't be stupid like me and make your stamp the same way around as the stencil! Make sure you flip the template horizontally before/when you print it. I'm going to use the extra foam I cut off in step 3 to redo the text. Also, if you use a molded surface of closed-cell foam, you'll probably have to roughen it for the chalk to stick.
Step 1: Print and tape template
Step 2: Start cutting
For the O and 0, cut the inner line first. For the 2s, cut inside the top first. For the O, 0, and Fourth Estate, ignore the support lines. This isn't a stencil, so they aren't necessary.
I found I had to add some more tape when I cut out the Fourth Estate.
Try to cut to an approximately uniform depth. I went about half a centimetre at first. When you finish cutting out a section, go back through the cuts with the knife to make sure they're cut cleanly to full depth.
Finally, remove the paper.
Step 3: Remove excess material
Partway through this step, I decided to cut off the extra foam at the top of my stamp. Later, I cut off the extra foam around the bottom.
When you've cut all of the negative space away to some depth, go back over it to clean it up and deepen it if necessary.
If you damage part of the foam that you want to keep, you can glue it back on, but make sure you test the glue on the back of the stamp to make sure it won't damage the foam.