Some of your replies crack me up. This is a 53 horsepower bike, it weighs in at 450+ wet and handles better than any other Kawasaki I've ever ridden. It is not considered fast by anyone. The frame is the first since 1969 that did not need a steering damper. It's got bracing and rake/trail changes that vastly improved it's manerisms. Too bad it was dropped in it's first and only year - 1976. Basically the same engine and bodywork as the previous H1's of the 1973-75 era, the KH500 name was given to it as were all Kawasakis in 1976. The Z1 became the KZ900 and the H1 and S3 became the KH400 and KH500 (Kawasaki Highway) designations.
This bike looks like it's all there. It should be a fairly easy restore or fixer. Motor work is cheap - I own 6 of them and have rebuilt/restored 9 in total. They do not need rebuilding every 5,000 miles. I know several that have 20,000 + on the original rings. This bike fully restored would be worth $3,500 tops. You can easily spend $6,000 getting it close. As with most bikes, you can get upside down in a hurry. I've got a CB750 that is 500% over invested and more coming. Good parts are out there, but they bring premium prices. You can get Honda CB750 parts for a 1/3 of what the H1 will cost you. The H2's will be 5 times as much - especially the more rare 1975 C MachIV's.
They are good bikes - the best of the Kawasaki 2 strokes in my opinion for comfort, balance, and reliability. Mine is one of my favorites.
Good luck and let us know how you do. Oh, $500 tops. You can get running examples of this bike for $1,000~1,200 if you wait. It's the parts, paint, and chrome that will eat you later.
Regards,
Gordon