RemoteEvent isn't connecting to a function when function has a sub-function?

Here is my code:

local bullet = game.ReplicatedStorage["Cyborg Assets"].bullet
local head = script.Parent.Parent:FindFirstChild("Head")
local ReplicatedStorage = game:GetService("ReplicatedStorage")
local event = Instance.new("RemoteEvent", ReplicatedStorage)
event.Name = "Cyborg SP1"

local function shootbullet()
	local debounce = false
	local Fireball = bullet:Clone()
	print("remoteEvent recieved")
	Fireball.BrickColor = BrickColor.new("Institutional white")
	Fireball.Transparency = 0
	Fireball.TopSurface = 0
	Fireball.BottomSurface = 0
	Fireball.CanCollide = false
	Fireball.Locked = true
	Fireball.CFrame = head.CFrame*CFrame.new(0,0,-10)
	local BodyVelocity = Instance.new("BodyVelocity")
	BodyVelocity.Parent = Fireball
	BodyVelocity.maxForce = Vector3.new(math.huge, math.huge, math.huge)
	BodyVelocity.velocity = head.CFrame.lookVector*40
local function Hurt(Part)
	local debounce = false
		if debounce == false then
		if Part.Parent:FindFirstChild("Humanoid") then
				Part.Parent.Humanoid.Health = Part.Parent.Humanoid.Health-25
				debounce = true
				wait(2)
				debounce = false
				wait()
			end
		end
		Fireball.Touched:connect(Hurt)
	wait()
	end
event.OnServerEvent:connect(shootbullet)
end

"remoteEvent received" is not appearing inside of the output but when I edit the code to this:

local bullet = game.ReplicatedStorage["Cyborg Assets"].bullet
local head = script.Parent.Parent:FindFirstChild("Head")
local ReplicatedStorage = game:GetService("ReplicatedStorage")
local event = Instance.new("RemoteEvent", ReplicatedStorage)
event.Name = "Cyborg SP1"

local function shootbullet()
	local debounce = false
	local Fireball = bullet:Clone()
	print("remoteEvent recieved")
	Fireball.BrickColor = BrickColor.new("Institutional white")
	Fireball.Transparency = 0
	Fireball.TopSurface = 0
	Fireball.BottomSurface = 0
	Fireball.CanCollide = false
	Fireball.Locked = true
	Fireball.CFrame = head.CFrame*CFrame.new(0,0,-10)
	local BodyVelocity = Instance.new("BodyVelocity")
	BodyVelocity.Parent = Fireball
	BodyVelocity.maxForce = Vector3.new(math.huge, math.huge, math.huge)
	BodyVelocity.velocity = head.CFrame.lookVector*40
end
event.OnServerEvent:connect(shootbullet)
local function Hurt(Part)
	local debounce = false
		if debounce == false then
		if Part.Parent:FindFirstChild("Humanoid") then
				Part.Parent.Humanoid.Health = Part.Parent.Humanoid.Health-25
				debounce = true
				wait(2)
				debounce = false
				wait()
			end
		end
		Fireball.Touched:connect(Hurt)
	wait()
end

Also, when I edit it to this way, the "Fireball" never appears.