Brother PE-DESIGN 7.0 Quick Reference Manual page 41

Automatically Converting an Image to an Embroidery Design (Auto Punch Function)
Move the pointer over the selected image, and then
drag the image to the desired position.
Step 2: Automatically converting the image to an
embroidery pattern
Next, the image will automatically be converted to an embroidery pattern.
a
Select the conversion method.
Click Image, then Image to Stitch Wizard.
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