What happens if you restore a factory unlocked iphone

What happens if you restore a factory unlocked iphone?

hii there, i have bought iphone 5 it is factory unlocked from usa i purchased it second hand in india i am not able to software update my phone (currently ios6).. it is also jailbroken (cydia).. and also i am not able to reset my phone it just hangs for 40 odd minutes then i have to hard restart...
questions are :
1.if i update to ios7 through itunes will it cause some problems as it is jailbreak.(as said by everyone)
2.if i restore to factory settings will it get locked again (as i am not sure whether this phone is carrier unlocked or unlocked by my local retailer).
i am ready to remove jailbreak.
pls advice

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    The term "factory unlocked" has no meaning. Your phone was not legitimately unlocked. Contact the carrier it is locked to and find out if you can get it unlocked.

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         First off i want to say that i am living currently in the Palestinian Territories/ Israel and have been using a unlocked windows phone ever since. I have a Locked AT&T iPhone 4 and have went ahead and taken it to a cell phone shop here that claimes that they can Factory Unlock any iPhone you bring them. The shop here didn't seem fishy or anything because their were about 50+ iPhones waiting for the Factory unlock prosess with many customers leaving happily with a unlocked iphone.
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    Torkit, I appreciate your help very much,
    This iPhone has been officially factory unlocked because I have done an update to 5.0.1 to 5.1.1 without loosing the unlock, and I have confirmed this with many others as well as the owner of the store who did a restore in front of me with one of the iPhones he has unlocked, and surely enough, he was greeted with "congratulations your iPhone is unlocked".
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