I just had the same trouble. There is a switch on the transom shift plate that has a little metal arm with a roller on the end that sits in a v notch. When there is tension on the shift cable it moves the v plate and activates the switch. Its supposed to activate when coming out of gear and kill the engine only for a split second. There should be a black ground wire and a tan wire that goes to the negative side of the coil. You can test to see if the switch is working by turning on the engine and pressing the arm of the switch, it should kill the engine. The only way to tell if the switch is really working, is on the water. When the boat is sitting in the driveway there is no resistance on the prop and the gears, so you can't test it at home.