This code can be used for a factory data reset. It'll remove following things:
* Google account settings stored in your phone
* System and application data and settings
* Downloaded applications
It'll NOT remove:
* Current system software and bundled applications
* SD card files e.g. photos, music files, etc.
PS: Once you give this code, you get a prompt screen asking you to click on "Reset phone" button. So you get a chance to cancel your operation.