I fixed the issue.
Issue:
[sEVERE] java.lang.IllegalArgumentException: URI "file:Tekkit.jar" is not hierarchical
Fix:
I was using the default version of java that yum found.
I explicitly searched for java 7 and installed the java-1.7.0-openjdk.i686 with all dependencies
launch.sh works fine now (after some tweaking for my own server specs)