How to clip decorative paper to rounded rectangle?

Greetings,

I am working in cs6 for Illustrator and Photoshop.  I would like to make a rounded rectangle with an inner border.  The area between the two borders I would like to add a decorative paper that I created in Photoshop.  The large center remains white.  I've tried clipping it, but apparently did not do it correctly.  Any thoughts on how to accomplish this?

Thanks