Because he spit him out as an egg. Namekians reproduce asexually. They are similar to reptiles in that way. The reason for how he could do it,despite having a hole being pucnhed through hi chest by Kid Son Goku is currently unkown. Although, no Piccolo Jr. is not Lord Demon King Piccolo's "reincarnation" as such just like Uub, he is just one of his mutant children, however being given all of his power and then some for some unknown reason.