What are the key requirements to successfully execute this AppLocker bypass?

The primary requirement is that the .NET assembly must be compiled against .NET Framework 2.0; compiling with .NET 4.0 will cause errors. The attacker also needs the ability to run PowerShell commands or import the diagnostic module. The technique exploits the fact that AppLocker does not restrict assembly loading via these methods, allowing code execution from arbitrary file paths. For a deeper analysis of similar bypasses, see Testing and Analysis of Bypassing AppLocker Using LUA Scripts.