Sorry to disappoint you but although a lot of money can be made here, it's not nearly as easy as you think. You seem not to understand how reverse splits work.
It's not the $0.25 cents that gets divided by 40. It's your share count. So it's:
50,000 shares/ 40 = 1,250 shares
Still same value though 1250 shares x $10 = $12,500.