In 1891, the H&TC chose Ennis to be its northern division headquarters. The machine shops and roundhouse employed several hundred men. One condition of the agreement was that as long as Ennis was able to furnish water the shops could not be moved from the community. The city built the first of three lakes for this purpose: Old City Lake in 1892, followed by New Lake in 1895, and Lake Clark (an extension of New Lake) in 1940. However H&TC would later be acquired by the Texas and New Orleans Railroad (T&NO), a subsidiary of Southern Pacific, in 1934. While it no longer hosted the company headquarters, the shops and yard in Ennis would remain and continue to be used as a hub for other lines and branches serving the city.