Inside the AND function there are two logical criteria. The first is straightforward, and ensures that only cells that match the color in E5 are highlighted:
The second test is more complex:
Here, we filter amounts to make sure that only values associated with the color in E5 (blue) are retained. The filtering is done with the IF function like this:
The resulting array looks like this:
Notice the value from the amount column only survives if the color is "blue". Other amounts are now FALSE.
Next, this array goes into the SMALL function with a k value of 3, and SMALL returns the "3rd smallest" value, 300. The logic for the second logical test reduces to:
When both logical conditions are return TRUE, the conditional formatting is triggered and cells are highlighted.
Note: this is an array formula, but does not require control + shift + enter.