no return spring = can't find neutral

What model bike? There's was an early service bulletin on the shift shaft arm (the part with the paws) getting pinched by the engine cases and trans cover. I had this happen on a Z1B engine. You can move the shifter up and down by foot or hand, but the spring is not strong enough to overcome the binding. It's easy to assume that the spring is incorrect or broken. Drain the oil, or tilt the bike to the right. Back all the transmission cover screws off 1 turn. If the shifter shaft now springs back to center, that's your problem. The solution is to add an extra gasket or shave the internal brace on the back side of the trans cover with a file.

MDZ - interesting. Mine body and engine is a 1980 F1, but my transmission cover is from a 197? B (though the model numbers are the same), so maybe this is possible. Additionally, I've dealt with the somewhat confusing fact that two different shape gaskets are sold as part number 11060-1056, which the kawi site indicates is the gasket for the f1. I purchased one on ebay that had this part number, but clearly had a hole for a nonexistent screw, and also didn't fit the opening just right on one side.