Can't apply damage to players over a Network

I got it working. Note! This might not be cheat proof.

The problem is that ApplyDamage works/runs only on the server. So I made a function the following changes.
The client tells the server he hit a player!

http://puu.sh/diaEj/7d9a90529d.jpg

The custom function replicates to Run on a server.

http://puu.sh/diaI7/6824f40a7e.png

Then, the apply damage manages the hitting stuff

http://puu.sh/diaKj/6a5f5bf274.jpg