Unassociated Document


    AMENDMENT
      TO PURCHASE AND SALE AGREEMENT

    BETWEEN
      NIELSON & ASSOCIATES, INC. AND

    RANCHER
      ENERGY CORP. DATED OCTOBER 1, 2006

    


    This
      Amendment to Purchase and Sale
      Agreement (this "Amendment") is made and entered into effective December
      15, 2006, by and between Nielson & Associates, Inc., a
      Wyoming corporation ("Seller") and Rancher Energy Corp.,
      a Nevada corporation, doing business in Wyoming as Rancher Energy Oil & Gas
      Corp. ("Buyer").

    


    WHEREAS,
      Buyer and
      Seller entered into a Purchase and Sale Agreement dated October 1, 2006 (the
      "PSA"); and

    


    WHEREAS,
      the parties
      desire to amend the PSA as provided herein;

    


    NOW,
      THEREFORE, in
      consideration of the mutual benefits derived from this Amendment, Buyer and
      Seller agree as follows:

    


    1. Buyer
      will pay to Seller an
      extension fee of Two Hundred Fifty Thousand Dollars ($250,000.00). This amount
      has been wired to Seller's account as directed by Seller. This amount shall
      be
      considered fully earned and nonrefundable upon execution of this Amendment
      by
      Buyer and Seller and the fee shall not be credited against the purchase price
      at
      closing.

    


    2. On
      the Closing Date, the Buyer
      shall deliver to the Seller a Warrant to Purchase Common Stock (the “Warrant”),
      which shall provide that the Seller may purchase from Buyer up to 250,000 shares
      of the Buyer’s common stock (the “Warrant Shares”) at an exercise price of $1.50
      per share at any time, or from time to time, during the period beginning six
      months after the Closing Date and ending five years after the Closing Date.
      The
      Warrant shall further provide that on the next registration statement filed
      by
      the Buyer with the Securities and Exchange Commission, but in no event later
      than March 7, 2007, the Buyer shall include therein, at no cost to Seller,
      the
      Warrant Shares for resale by the Seller.

    


    3. Section
      3.1 of the PSA is
      hereby amended to change the Closing Date from "on or before December 15, 2006"
      to "on or before December 22, 2006." 

    


    4. In
      lieu of the Three Million
      Dollar ($3,000,000) payment provided for in Section 2.1 of the PSA, which amount
      is payable when average total production from the Assets equals or exceeds
      1,000
      barrels of oil per day, Buyer shall pay to Seller, at closing, the sum of One
      Million Seven Hundred Fifty Thousand Dollars ($1,750,000). Accordingly, Section
      2.1 of the PSA is hereby deleted in its entirety and is replaced with the
      following:

    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    2.1 Purchase
      Price. The purchase price for the Assets is Forty-Six Million Seven Hundred
      Fifty Thousand Dollars ($46,750,000.00) (the "Base Purchase Price"), subject
      to
      the adjustments provided for herein, which amount shall be due at
      Closing.

    


    5. Seller
      acknowledges that the time for asserting title defects pursuant to Section
      5.3
      (A) of the PSA has passed and that Seller will not be asserting further title
      defects with respect to the Assets. 

    


    6.
       Seller acknowledges that the time for asserting title defects pursuant to
      Section 6.3 of the PSA has passed and that Seller will not be asserting further
      title defects with respect to the Assets. 

    


    7. All
      other terms, covenants, and
      conditions of the PSA shall remain unaffected and in full force.

    


    8. This
      Amendment may be executed
      in counterparts pursuant to Section 15.14 of the PSA.

    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
 

    
      DATED
        this 15th day of December, 2006.

      


      


      
        	
                SELLER:

              	
                 

              	
                NIELSON
                  & ASSOCIATES, INC.

              
	 	 	 
	 	 	 
	 	
                By:

              	
                /s/
                  Tom Fitzsimmons

              
	 	 	
                Tom
                  Fitzsimmons

              
	 	
                Title:

              	
                
                  Executive
                    Vice President and Chief Operating Officer

                

              
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	
                BUYER:

              	
                 

              	
                RANCHER
                  ENERGY CORP.

              
	 	 	 
	 	 	 
	 	
                By:

              	
                /s/
                  John Works

              
	 	 	John
                Works
	 	
                Title:

              	
                
                  President
                    and Chief Executive Officer