I wouldn't quote it. Just recount the story saying whoever used a racial slur. Don't have to say the slur to understand one was used and that it was bad/impacted your perception in some way.
Also, if you are white, sometimes using someone else's experience of being discriminated against comes off as like..."I understand how bad it is. I saw my black friend go through it." And witnessing it vs living through it yourself are very different. So just be very careful on how you come off in the retelling. Tread lightly and good luck.