First, grease a square cake pan with butter. Set aside. Use either a candy thermometer or small glass of cold water to check for softball stage of candy. If you use water, place the glass of water into the freezer of fridge until needed, preferably, when you first begin to make candy.)
Add to a saucepan the first three ingredients. Then add milk and mix well. Place saucepan onto of stove at medium heat and add butter or margarine to these first ingredients. Bring these to a rolling boil, stirring constantly to keep from boiling over in pan. (You can use a candy thermometer to keep track of degrees or you can use a glass of cold water to check for soft ball stage of candy).
After about 5 minutes of boiling cut heat down to medium low and continue stirring for at least another 15 to 20 minutes. To check softball stage with water, use spoon from candy and drop only a tiny bit from tip of spoon into cold water. If softball stage is reached, a small ball will form without spreading or melting in water.
After softball stage is reached, remove from heat and add peanut butter and vanilla flavoring. Stir in oats. Drop by tablespoons onto a greased pan or you can spread the mixture and cut into squares after cool.