Per's series on the Saab had some pretty good info.
The rot you see from the outside will be just the tip of the iceberg (painfully remarked the guy who has re-rockered MGBs etc). If the side of the rocker is rotted from the inside, usually what has happened is that dirt etc has filled the rocker, this keeps the metal wet and causes rust. This unfortunately means there will be much more extensive rust present once you crack into it. BTDT.
Once all is welded back together,keep in mind that weld slag and steel particles rust FAST. That means you have to be able to thoroughly clean the INSIDE of the repaired area, remove all the slag and metal particles and then protect it somehow. Otherwise, your problem could come back! Eastwood's Heavy Duty Anti Rust preventive does a good job, there is a spraygun tool with long tubes and directional nozzles which help apply the stuff. If you can get inside the panel from the back side, they also sell some stuff called Rust Encapsulator, that's what is on the floors of the Jensen Healey. The good thing about that stuff is that it doesn't require a topcoat.