Code K indicates that investments that do not have a readily available FMV were distributed. The $0 amount in boxes 1 and 2a with box 2b Taxable amount not determined not marked on the Form 1099-R suggests that the custodian has determined that those investments have $0 of value. The instructions for Form 5498 say that such assets should be reported at the FMV determined on December 31. It would seem that the same rule should apply to amounts reported on Form 1099-R. It's possible that they made no effort to determine the value of these shares since none remained in the traditional IRA. However, it seems to me that they should have valued the shares anyway since the shares still exist.
You are getting TurboTax's request for explanation because TurboTax interprets a zero in box 2 for a distribution from a traditional IRA reported with code 1, 2 or 7 in box 7 as indicating a distribution of excess contribution after the due date of the tax return.
If the shares truly had zero value at year end, it seems that the $0 amount reported in box 1 is accurate and you could just omit the Form 1099-R from TurboTax. Otherwise, you would probably have to determine the actual year-end value and file a substitute Form 1099-R (Form 4852) to report the true taxable amount.
