How to associate leads with a Vendor or Contact by State

How to associate leads with a Vendor or Contact by State

We utilize an external sales force that operate on commission.  Each sales rep has their own territory.  They do not have a Zoho CRM account.  Right now I created Vendors for my sales rep companies and list the Sales Reps as contacts for them. 

I would like to find the best way to associate leads/contacts with a sales rep.  I'm not sure if a related list or pick list will work best. 

1. I would like sales reps to be able to submit leads using a web form and have a way to automatically or easily associate the lead with them.

2. I'd like to be able to create rules that can notify sales reps of a lead/contact action/activity/visit.

3. I'd like to be able to mass update a group of leads and associate them with a sales rep.