Yes, all true, but what will happen is the negative narrative will start up about screwing shareholders, typical OTC:BB POS, dilute and reverse and repeat, etc., etc., etc.
If the SP is 1.25 for a reverse of 4 to 1 then in theory the cap and value should remain, and after the reverse the SP should be $5. But, in the wild, wild west of trading, market perception based on negative narrative will impact cap and value by at 1/4 and up to 1/2. Yes, once the dust is settled the SP will return to $5 and probably higher, but until then one should expect lows around $3 before recovering and on wild swings.
Why is this? Where does the negative narrative come from? Three sources: 1) opportunists looking to sell and buy back lower or buy in at lowest possible value by taking advantage of all confusion caused by reverse uplisting. 2) Market makers who will still be trading from the old venue and new MMs on the new exchange will do all they can to maximize volume as well as maximize what the clip and shave. 3) long term short interest grandfathered in from before the changes to naked shorting rules in 2007 and 2008 as well as naked short float under current current rules and especially from off-shore markets such as Canada and Germany.
As for the grandfathered naked shorts these are open positions from the spike in 2006 when the SP ran to over $3. These guys are going to fight tooth and nail to prevent having to cover those long term open positions.