I would change the wording some.
The parameters of the emissions function are estimated using the nonlinear regression methods in Matlab. Coefficients are estimated using an iterative procedure starting from the initial values of the coefficients, minimizing the sum of the squares of the residuals.
The changes I made were relatively minor, but appropriate I think.
1. "nonlinear regression methods" instead of "nonlinear regression models". You could also say "nonlinear regression algorithms". A model is what you have provided, that is fit to the data, whereas an algorithm or method would be the scheme used to fit that model.
2. "iterative" replaces "interactive". To me that seems self evident. Simply the wrong choice of word.
3. I added the clause "minimizing the sum of the squares of the residuals". This was done because iterative methods might also be employed to minimize measures like the sum of absolute values, or other norms applied to the residuals.
