Box 1: be created in the same availability set or virtual machine scale set.
The Basic tier is quite restrictive. A load balancer is restricted to a single availability set, virtual machine scale set, or a single machine.
Box 2: be connected to the same virtual network
The Standard tier can span any virtual machine in a single virtual network, including blends of scale sets, availability sets, and machines.
Reference:
https://www.petri.com/comparing-basic-standard-azure-load-balancers