The seaport towns in south Texas received the first large number of settlers as many seemed happy to settle where they landed.

The Republic of Texas, created in 1836, was anxious to find relief for the financially troubled new state.  The Texas legislature passed a bill February 4, 1841  to entice settlers.  This bill granted empresario rights to the men of the Peters Colony settlement, sometimes referred to as the Texas Land and Emigration Company.  

An unlikely land empersario chosen was W. S. Peters.  Peters and his brothers made numerous trips to Texas bringing families to settle.  The first contract between the Texas Land and Emigration Company and the Republic of Texas was signed on August 10, 1841.   In this initial contract, Peters promised to bring a colony of 600 families within three years.  The headquarters of the Peters colony was in Louisville, Kentucky, where Peter's son, William C., operated a music store.

The Republic of Texas granted 640 acres of land to each family and 320 acres to each single man over the age of 17 if they settled within the prescribed boundaries of the contract.  Another stipulation in the contract was that the settlers were to "be of good moral character".

The following ad was placed in the Bonham Weekly on February 25, 1842:
"To Emigrants - Now within the Republic of Texas, the undersigned agent of the Peters Colony takes this method to say that to all families who proceed to the Colony, make their selection, build their cabins and occupy same on or before the first day of June next, 640 acres or one section of land will be given - and young men over 17 years, a half section, or 320 acres."

The first wave of settlers in 1844 - 1845 consisted of a total of 822 colonists.  The second wave in 1846 - 1848 consisted of 1,286 settlers.

The first contract established the boundaries of the colony as beginning on the Red River at the mouth of Big Mineral Creek, running south for sixty miles, the west for twenty-two miles, north the the Red River, and then east with the River to the point of origin.

The empresarios were allowed to retain up to one-half of a colonist's grant as payment for services rendered, including land surveys and title applications.  The empresarios provided powder, shot, and seed, and in some cases built settlers' cabins.  The empresarios also received ten sections of premium land from the republic for each 100 families.

The boundaries of the colony were extended in a second contract signed on November 9, 1841.  This contract extended the boundaries forty miles southward.  It also increased the required number of colonists to 800.

On November 20, 1841 a new company formed in Louisville called the Texas Agriculture, Commercial, and Manufacturing Company.  This new company sent its first group of immigrants to the Cross Timbers area of Texas by steamboat  in early December..

Difficulties attracting and keeping settlers in the colony cause the company to request an extension of time and another boundary adjustment.  The third contract, signed by Sam Houston on July 26, 1842, provided an extension of six months for the first third of the colonists and the boundary was extended to enclose a ten-mile-wide strip on the west and a twelve-mile-wide strip on the east.