Heat oven to 350°F. Beat first 5 ingredients with mixer on low speed just until moistened, stopping frequently to scrape bottom and side of bowl. Beat on medium speed 2 min. Pour into greased and floured 13x9-inch pan.
Bake 35 min. or until toothpick inserted in center comes out clean. Cool completely in the pan .Beat cream cheese and butter with mixer until well blended. Gradually add sugar, beating well after each addition.
Remove cake from pan. Carefully cut cake crosswise in half using serrated knife. Place 1 cake half, top-side down, on plate; spread with some of the cream cheese frosting. Top with remaining cake half, top-side up. Spread top and sides with remaining frosting. Press nuts into sides. Keep refrigerated.
NOTE: I made this for our niece's baptism dinner today (on Chad's side). The cake was one of the moistest cakes I have had. It was delicious, and everyone raved! Not to mention it looks fabulous. :) I also sprinkled a light amount of walnut crumbs on the top to make it look pretty. This is a great recipe for a crowd or dinner party. You can't go wrong here!
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