HELP! Can customer not use 'forgot password' link if account has not been activated?

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Would REALLY appreciate some help please!! I have spent hours formatting our customer base to complete the CSV to import customers. I now have thousands of customers imported into the store. We were planning on sending out bulk invites for customers to activate account. HOWEVER, if they do not see the invite, and try to create a new account using same email address, they get the message that an account already exists. In that situation the 'forgot password' link doesn't work. Does 'forgot password' link only work after account has been activated? We are going live next week and will need to delete customer database as this issue is causing frustration for test users trying to sign up. Thank you!