I used to have a 40hp yammie from the same series. To connect the stop-/ killswitch you've got to take the wire from the ignition coils ( I think..?) + a second wire which is tightened to the block. It's function is to make ground, and in this case grounding the ignition to stop the engine, which is what you want to achieve.
Don't be fooled by the colors, just trace back the wire to the exact component it's coming from.
* By the way; the grey wire is almost certain to be a signal sender to the potential tacho-meter. This wire comes from the lighting coil under the flywheel to charge the potential battery. This coil could be smoked now you've connected the ignition wire to it, but you could be lucky.
Always; make sure the wire & connectors are tight and well isolated, aren't frayed or cut anywhere.
This should do the trick I believe...
"Only the dead have seen the end of boating.."