How do I make something happen when clicking a tool?

You are correct so far; what you want to do next is connect to the Button1Down event:

local tool = script.Parent
tool.Equipped:connect(function(mouse)
    mouse.Button1Down:connect(function()

    end)
end)

For making other players walk away, iterate through each other player in the game and call Humanoid:MoveTo to tell them to walk:

local tool = script.Parent
local player=game.Players.LocalPlayer
local radius=30

local t=player.Character:WaitForChild("Torso")
tool.Equipped:connect(function(mouse)
    mouse.Button1Down:connect(function()
        for _,v in pairs(game.Players:GetPlayers())do
            if v~=player and v.Character then
                local char=v.Character
                if char:FindFirsrtChild("Torso")and char:FindFirstChild("Humanoid")then
                    local torso,h=char.Torso,char.Humanoid
                    if(torso.Position-t.Position).magnitude<=radius then
                        h:MoveTo(torso.Position+CFrame.new(t.Position, torso.Position).lookVector*radius,t)
                    end
                end
            end
        end
    end)
end)