On Cluster1: Import the Azure Migrate appliance. In Azure: Create an Azure Migrate project.

APP3 and APP4 run as virtual machines on the on-premises Cluster1 Hyper-V failover cluster, so migrating them to Azure uses the Azure Migrate: Server Migration workflow for Hyper-V. That workflow requires an Azure Migrate project to first be created in Azure, since the project is the container that organizes the migration effort, tracks discovered and assessed machines, and holds the configuration for the subsequent discovery and replication work. On the Cluster1 side, the Azure Migrate appliance -- a purpose-built VM or OVA image supplied by Azure Migrate specifically for Hyper-V environments -- must be imported (deployed) onto the Hyper-V host or cluster, where it discovers the VMs running there and orchestrates their replication into Azure. Configuring an Azure Network Adapter, creating a Point-to-Site VPN connection to Vnet1, installing the Azure File Sync agent, and installing the Windows Server Migration Tools are all unrelated actions that do not perform Hyper-V VM discovery or replication for an Azure Migrate project. Similarly, creating a premium block blob storage account, a private endpoint, or a VPN gateway in Azure are not the resource that Azure Migrate itself requires to begin a migration project -- an Azure Migrate project is. Therefore, importing the Azure Migrate appliance onto Cluster1 and creating an Azure Migrate project in Azure are the two required preparatory actions.