Sounds like the propshaft seized at the rear bearing carrier, the carrier broke and that’s what holds the propshaft and gears in. Had to have been one heck of a clunk.
The damage may extend all the way to the powerhead. Before sourcing parts, I recommend you get the powerhead off the tower and inspect the drive shaft at both ends — has it broken/twisted, in what shape are the splines and is the crankshaft receiver damaged. Check the gearcase end of the shift rod — it may be mangled.