Creature - Illusion 3/3, 3U (4) Flying Vanishing 3 (This permanent comes into play with three time counters on it. At the beginning of your upkeep, remove a time counter from it. When the last is removed, sacrifice it.) When Chronozoa is put into a graveyard from play, if it had no time counters on it, put two tokens into play that are copies of it.1
Illus. James Wong
The ability checks if there are any time counters on it when it left play. It does not matter how it left play with no time counters on it. [Planar Chaos FAQ 2006/12/13]
The copies come into play with 3 time counters each and with Vanishing, so the process can repeat. [Planar Chaos FAQ 2006/12/13]