In a large bowl, combine 1 1/2 cups of flour, sugar, undissolved yeast, salt and herbs.
Heat milk, water, and 1/4 cup butter until very warm (120-130 degrees F.); stir into dry ingredients.
Stir in egg and enough remaining flour to make soft dough.
Knead on lightly floured surface until smooth and elastic, about 4-6 minutes. Cover; let rest on floured surface 10 minutes.
Divide dough into 3 equal pieces. Roll each piece into a 30-inch rope. Braid ropes and pinch ends to seal. Tie a knot in the center of braid; wrap ends around knot, in opposite directions and tuck under to make a round loaf. Place on a greased baking sheet. Cover; let rise in warm place until double in size, about 20 minutes or more.
Bake at 375 F. for 30 minutes or until done, covering with foil during last 10 minutes of baking to prevent excess browning.
Melt one tablespoon of butter; brush over loaf. Sprinkle with additional herbs or garlic salt, if desired. Remove from sheet; let cool on wire rack.