I figured I would ask before taking to a technician. Pulled out the clutch to measure the discs. The previous owner did burnouts and the sprockets had shark teeth.
I followed the repair manual, used the special tool. Removed and replaced. I never noticed until was ready to test drive in neutral there is a roaring/slight scraping sound only in neutral. Clutch lever in and the sound goes away smoothly.

Based on the clutch operation could this be the clutch basket placed incorrectly back on the spline? Has a bearing gone out? Could I take the clutch case cover off and rotate the rear wheel and recreate this sound? To me sounds maybe I put something in wrong. 1st - 6th gear are smooth no problems. Just in neutral and found this related post on cbr500riders and there is a video of the same or similar issue.


http://hpholm.dk/CBR500RA_Normal.mp4