Dissolve 1 package dry yeast in 1/2 cup lukewarm water with 1 teaspoon sugar and set aside. Bring 1 cup of milk to a boil. Remove from heat and add, mixing well, 1/4 cup sugar, 1/4 cup butter, 1 1/2 cup flour, and 1 teaspoon salt. Add 2 eggs and beat well. Add yeast mixture to above and beat again. Add 2 1/2 cups flour and fold well. Let rise until it doubles in size (45 minutes to 1 hour). Cover. Grease and flour angel food pan. Place dough on floured surface and knead several times. Make balls the size of walnuts.
Combine 1 cup butter, melted and cooled, 1 1/2 cup sugar, 5 teaspoon cinnamon, and 3/4 cup chopped nuts. Roll dough in butter and then in nut mixture. Place balls in cake pan evenly. Let rise about 45 minutes, covered in a warm spot until it doubles in size. Bake at 350 degrees for 45 minutes and cool in pan 20 minutes, then remove.