Colonel Richard Henderson was one of the principal judges in North Carolina, a scholarly, talented man, eminent in the legal profession; although but thirty-nine years of age, he wielded much influence. Knowing and respecting Daniel Boone, Henderson was much impressed by the former's enthusiastic reports concerning the soil, climate, and scenery of Kentucky; and, acting solely upon this information, resolved to establish a colony in that attractive country. He associated with himself three brothers, Nathaniel, David, and Thomas Hart, the last-named of whom in later life wrote that he "had known Boone of old, when poverty and distress held him fast by the hand; and in those wretched circumstances he had ever found him a noble and generous soul, despising everything mean." Their proposed colony was styled Transylvania, and the association of proprietors the Transylvania Company.
It will be remembered that in the treaty of Fort Stanwix (1768) the Iroquois of New York had ceded to the English crown their pretensions to lands lying between the Ohio and the Tennessee. The Transylvania Company, however, applied to the Cherokees, because this was the tribe commanding the path from Virginia and the Carolinas to Kentucky. In March, 1775, a great council was held at Sycamore Shoals, on the Watauga River, between the company and twelve hundred Cherokees who had been brought in for the purpose by Boone. For $50,000 worth of cloths, clothing, utensils, ornaments, and firearms, the Indians ceded to Henderson and his partners an immense grant including all the country lying between the Kentucky and Cumberland Rivers, also a path of approach from the east, through Powell's Valley. At this council were some of the most prominent Cherokee chiefs and southwestern frontiersmen.
When the goods came to be distributed among the Indians it was found that, although they filled a large cabin and looked very tempting in bulk, there was but little for each warrior, and great dissatisfaction arose. One Cherokee, whose portion was a shirt, declared that in one day, upon this land, he could have killed deer enough to buy such a garment; to surrender his hunting-ground for this trifle naturally seemed to him a bad bargain. For the safety of the pioneers the chiefs could give no guarantee; they warned Boone, who appears to have acted as spokesman for the company, that "a black cloud hung over this land," warpaths crossed it from north to south, and settlers would surely get killed; for such results the Cherokees must not be held responsible.