In large bowl, combine 1 cup flour, sugar, cocoa powder, undissolved yeast and salt. Heat milk, water and butter until very warm (120-130 degrees).Gradually add to dry ingredients; beat 2 minutes at medium speed of electric mixer, scraping bowl occasionally.Add egg, vanilla and 1/2 cup flour, beat 2 minutes at high speed, scraping bowl occasionally. With spoon, stir in enough additional flour to make soft dough.Knead on lightly floured surface until smooth and elastic, about 4-6 minutes.Cover, let rest on floured surface 10 minutes. Divide dough in half.For body, knead chocolate morsels into 1 half, form into ball. Place on bottom end of large greased baking sheet; flatten to make 5-inch round. For head, remove 1/3 of remaining half, form into ball. Place on large baking sheet above body, flatten slightly, pinching to attach.For nose, pinch off 1/2 inch ball from remaining dough; place on center of head. Divide remaining dough into 4 equal portions, roll each to form 6-inch rope.For arms, arrange 2 ropes across body; attach by tucking one end of each under body.Shape remaining ropes into ears; arrange above head. Attach by tucking one end of each under head.Cover, let rise in warm draft-free place until doubled in size, about 30-45 minutes.Bake at 350 degrees for 45-50 minutes or until done, covering aluminum foil after 20 minutes to prevent excess browning.Remove from sheet; cool on wire rack. Decorate as desired.