The code L indicates that you defaulted on the loan by not continuing to make payments. A code-L distribution distribution does not satisfy the loan and you are still required to pay the loan back. Perhaps the purchasing company failed to continue payroll deductions needed to keep the loan from defaulting, but it still ends up being your responsibility to stay current on the loan repayment.
If the plan instead reduced your balance in the plan by the amount of the loan, this should have been reported as an offset distribution rather than a deemed distribution. If it was an offset distribution you would have until the due date of your tax return, including extensions, to come up with the funds to do a rollover of a qualified offset distribution.
It might be informative to ask the plan why this became a deemed distribution instead of an offset distribution.
