Hi Ar,
Yes it requires reboot.
More info:
Upgrading the Cisco IOS Software Release on a Stack
#
FlexStack has the capability to upgrade all members with a single command. A single command eases the operational burden on the network administrator. The command to initiate an upgrade takes place on the master. The master makes sure that each member is properly upgraded.
#The Cisco IOS Software CLI command to upgrade a FlexStack stack
#"archive download-sw [options] ."
#The default behavior is to upgrade all members.
http://www.cisco.com/en/US/prod/collateral/switches/ps5718/ps6406/white_paper_c11-578928.html
HTH
Regards
Inayath
*Plz rate if this info is helpfull.