Microwave chocolate, 1/2 cup sugar and water in large microwaveable bowl on HIGH 2 min. or until chocolate is almost melted, stirring after 1 min. Stir until chocolate is completely melted. Cool.
Mix flour, baking soda and salt. Beat butter and remaining sugar in large bowl with mixer until light and fluffy.
Add eggs, 1 at a time, beating after each until well blended. Beat in flour mixture alternately with milk.
Add chocolate mixture and vanilla; mix well.
Pour into 2 greased and floured 9-inch round pans.
Bake 30 to 35 min. or until toothpick inserted in centers comes out clean. Cool in pans 10 min.; remove from pans to wire racks. Cool completely. Fill and frost with Easy Chocolate Frosting.