On June 8, 2007, a Notice of Violation and Exercise of Enforcement Discretion were issued for two Severity Level III violations. The first violation involved the licensee's failure to meet the terms and conditions of an order issued to the licensee for not paying its annual fees. The second violation involved the licensee's failure to use a minimum of two independent physical controls that form tangible barriers to secure three portable gauges from unauthorized removal, when the portable gauges were not under the control and constant surveillance of the licensee. Specifically, the licensee stored the gauges in unlocked transportation cases located inside an unoccupied, unlocked hallway that could be accessed by unauthorized individuals. Although a civil penalty would normally be issued in this case, enforcement discretion was exercised because the licensee has transferred all licensed material to an authorized recipient, its NRC license has been terminated, and the licensee has no intention of conducting NRC-licensed activities in the future.