The answer to that question is sorta yes. They would have to be issued. The amount they actually issue can be anything from 0 to all 3.5 billion. The result is a stock split or forward stock split (float increase). (I'm assuming by r/s you mean reverse split). What can also happen with the issuance of the shares is dilution (something I was worried about a while back).
Something that I don't think is likely is a reverse split followed by issuance of shares for dilution but is possible.