In my case, none of above answers nor google's official documentation helped me to grab the concept of PendingIntent class.
And then I found this video, Google I/O 2013, Beyond the Blue Dot session. In this video, ex-googler Jaikumar Ganesh explains what PendingIntent is, and that was the thing gave me the big picture of this.
Below is just transcription of above video (from 15:24).
So what's a pending intent?
It's a token that your app process will give to the location process, and the location process will use it to wake up your app when an event of interest happens. So this basically means that your app in the background doesn't have to be always running. When something of interest happens, we will wake you up. This saves a lot of battery.
This explanation becomes more clear with this snippet of code(which is included in the session's slide).
PendingIntent mIntent = PendingIntent.getService(...);
mLocationClient.requestLocationUpdates(locationRequest, mIntent);
public void onHandleIntent(Intent intent) {
String action = intent.getAction();
if (ACTION_LOCATION.equals(action)) {
Location location = intent.getParcelableExtra(...)
}
}