Well, you can achieve this by making use of the AJAX call to your server where details related to states, cities and sales representatives are stored.
Logic will be to call a JavaScript function
onChange of the drop-down box. This function will make an AJAX call to your server, which, in turn, will respond with the required data (probably in JSON/XML format). Then, dynamically create new drop-down boxes and populate the data.
For more information on AJAX, check
http://www.w3schools.com/ajax/default.asp
Regards,
Niral Soni