The AT&T Galaxy S2 (SGH-i777) is hard reset by turning the phone off completely. Remove the battery for a minute to be sure. Then hold both the volume down, volume up and power buttons until the screen flashes. Release the power button but keep holding the volume buttons. When you boot into recovery, you can use the volume keys to move the selection up and down. Use the power button to apply the selection. It will say something like wipe data/factory reset. That's what you want.