Thanks for the ideas. I'll probably make this a 2-3 year project to space out the costs. I'll try the ideas you guys suggested and if still no compression then I'll put in a cb400f engine, ride it and keep working on the cb350f engine.
I knew it was a good price when I saw it and that's why it sold 90 minutes after listing. Like I mentioned there is a lot of surface rust and fading. It was stored under a loose tarp in a shed. The tank is rusty but I think I'll be able to salvage it with por15. It'll require a total tear down, carb work (already ordered kits from a board member) paint, new spokes, spark wires, caps, etc. We'll see about the exhaust ($$$). It's very similar to the cb400f which I've worked on for the last year. I've learned from it and hopefully I won't make the same mistakes on this one!
Gotta go. Taking my cb400f for it's maiden (long distance) voyage.