(a) Applicability of division.--This division applies to letters of credit and to certain rights and obligations arising out of transactions involving letters of credit.

(b) Effect of statement of rule in this division.--The statement of a rule in this division does not by itself require, imply or negate application of the same or a different rule to a situation not provided for, or to a person not specified, in this division.

(c) Variation by agreement or undertaking.--With the exception of this subsection, subsections (a) and (d), the definitions of “issuer” and “letter of credit” under section 5102(a) (relating to definitions) and sections 5106(d) (relating to perpetual letters of credit) and 5114(d) (relating to assignment of proceeds), and except to the extent prohibited under sections 1302 (relating to variation by agreement) and 5117(d) (relating to time at which subrogation rights arise), the effect of this division may be varied by agreement or by a provision stated or incorporated by reference in an undertaking. A term in an agreement or undertaking generally excusing liability or generally limiting remedies for failure to perform obligations is not sufficient to vary obligations prescribed by this division.

(d) Independence of rights and obligations of issuer.--Rights and obligations of an issuer to a beneficiary or a nominated person under a letter of credit are independent of the existence, performance or nonperformance of a contract or arrangement out of which the letter of credit arises or which underlies it, including contracts or arrangements between the issuer and the applicant and between the applicant and the beneficiary.