Heat oven to 350 degrees. Grease and flour two 9 inch round cake pans. In large bowl, combine cream cheese, 1/2 c butter, vanilla and peppermint extracts; blend until smooth. Ad powdered sugar alternately with hot water, beating until smooth. Blend in chocolate. In another large bowl, combine 2 c of the frosting mixture and 1/4 c butter; blend well. Beat in eggs, one at a time, beating well after each addition. Lightly spoon flour into measuring cup; level off. Ad flour, baking soda, salt and milk; beat until smooth. Pour batter evenly into greased and floured pans. Bake at 350 degrees for 30 to 40 minutes or until toothpick inserted in the center comes out clean. Cool 5 minutes; remove from pans. Cool completely. To assemble cake, place one layer, top side down, on serving plate; spread with about 1/4 of frosting. Top with second layer, top side up. Spread sides and top of cake with remaining frosting. Store in refrigerator.