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Preheat oven to 350F degrees.
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Grease and flour two 9 inch cake pans.
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For the cake: In small saucepan, melt 2/3 cup of the butterscotch chips in 1/4 cup water.
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Cool.
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Combine flour and remaining cake ingredients and cooled butterscotch mixture at low speed until moistened.
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Beat 3 minutes at medium speed.
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Bake for 20-30 minutes .
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Cool 10 minutes and remove from pans and cool completely.
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For the filling: In medium saucepan, combine 1/2 cup sugar with cornstarch.
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Stir in heavy cream, 1/3 cup water, egg and remaining 1/3 cup butterscotch chips.
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Cook over medium heat until mixture thickens stirring constantly.
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Remove from heat.
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Stir in butter, coconut and nuts.
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Cool.
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For the cream: In small bowl beat cream until soft peaks form.
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Gradually add brown sugar and vanilla.
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Beat until stiff peaks form.
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To assemble: Place cake layer on serving plate.
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Spread with 1/2 the butterscotch filling.
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Top with second layer, spread remaining filling on top to within 1/2 inch of edge.
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Frost sides and edge with cream.
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Refrigerate at least 1 hour before serving.
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Store in refrigerator.