Combine the first 5 ingredients in pan and cook over med/low heat, stirring constantly until butter melts and sugar dissolves. Scrap sides making sure they are free of any sugar crystals.
Attach a candy thermometer to pan, making sure it does not touch bottom of the pan.
Increase your heat to medium and bring to a boil. Do not stir while syrup is boiling. (This is very important and also why you must be sure to have a large enough pan. Mixture will boil up and you will be inclined to stir it back down for fear it is going to overflow.)
DO NOT STIR WHILE SYRUP IS BOILING! Your mixture will be whitish yellow at beginning, but by the time it has reached the proper temp it will be a dark caramel color.
Continue to cook until syrup reaches soft ball state or 234-240 degrees on thermometer.
Turn off heat, or remove from heat and add vanilla leaving thermometer in mixture.
DO NOT STIR IN THE VANILLA, until mixture cools to 200 degrees.
Beat the fudge with an electric mixer set on medium until it is thick and no longer glossy.
Stir in the nuts.
Pour into a buttered 8 X 13 pan. Cool completely.
Cut into 1 inch squares. Store in an airtight container in refrigerator.