To knock people unconscious.
The Forget-Me-Stick is a black colored baseball bat with a skull on it. Minion mainly uses it to knock people out whenever they run out of the knock-out spray.
The Forget-Me-Stick is what Minion uses to hit people in the head with. The reason why its so powerful is probably because of Minion's body (and due to the fact he aims at the head), the blow is so strong, the victim will instantly forget what had happened just now (but a truly hard blow would have made the victim forget everything he knew).
The Forget-Me-Stick first appears in Hal's apartment, which Hal thought his intruders were robbers, and tries to beg that the one next door had way more "stuff" than him. Minion hits him with the stick, and he completely forget what happened just now. The stick also appears at a cutscene at the end of the movie, where Minion busily gets the laundry, and Bernard pops out of the laundry machine. Minion then proceeds to knock him out with the Forget-Me-Stick, and the screen goes black.