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Denny's parent signs agreement with NAACP More black owners, employees promised


Fifty-three Denny's restaurants -- probably including the Annapolis Denny's where six black Secret Service officers claimed they were refused service this spring -- would become black-owned franchises by 1997 under an agreement signed in Baltimore yesterday between Flagstar Cos. Inc. and the NAACP.

The agreement comes as Flagstar, a Spartanburg, S.C.-based corporation which has 120,000 employees in several restaurant groups, defends itself against several race-discrimination lawsuits filed against the Denny's chain.

The seven-year pact with the NAACP would increase Flagstar's hiring and promotion of blacks and its use of black suppliers, as well as boost franchise ownership.

"This is substance: $1 billion over the next seven years will flow into the hands of African-Americans," said the Rev. Benjamin F. Chavis Jr., executive director of the National Association for the Advancement of Colored People, at a signing ceremony at the civil rights group's headquarters in Northwest Baltimore.

Dr. Chavis called the "fair-share agreement" -- one of about 60 negotiated by the NAACP since 1982 -- "a model for the rest of corporate America and for the rest of the civil rights movement."

Under the agreement, Flagstar would also aim to:

* Hire 325 new black managers at an average annual salary of $42,000 by the year 2000.

* Spend 10 percent of its $65 million annual marketing and advertising budget with black-owned companies.

* Buy 12 percent of its $800 million yearly purchases of food, paper and other items from black suppliers.

* Place a black member on Flagstar's board of directors.

* Allow the National Association for the Advancement of Colored People to do random testing for discrimination at its 2,500 restaurants across the nation, including Denny's, Hardee's, Quincy's Family Steakhouse, El Pollo Loco and Canteen food service outlets.

Flagstar agreed to help the civil rights group pay for a computer and telephone network in selected NAACP offices around the country. Such a communications system has been a goal of Dr. Chavis since he became NAACP executive director in April.

Both Dr. Chavis and Jerome J. Richardson, Flagstar chairman and chief executive officer, said the accord grew out of negotiations that began 18 months ago. They insisted that the agreement wasn't directly related to the flurry of bias complaints leveled at Denny's in recent months.

Denny's now has only one black-owned franchise, a restaurant that opened in South Central Los Angeles after last year's riots.

Mr. Richardson said he "would like very much to see" the Annapolis Denny's become a black-owned franchise, but offered details of how soon that might happen.

Flagstar spokeswoman Karen Randall said only that it was "something we are actively pursuing." Annapolis Alderman Carl O. Snowden confirmed that negotiations were going on between Flagstar and an unidentified black potential investor.

"It certainly would be a welcome gesture because there are so few minority businesses in the city. That would be something substantive and concrete," Mr. Snowden said.

Mr. Snowden said the Flagstar-NAACP agreement "could change literally the complexion of who owns Denny's around the nation. However, it does not resolve the outstanding issue, particularly here in the city of Annapolis."

Frank Watkins, a spokesman for the Rev. Jesse L. Jackson's National Rainbow Coalition, which has picketed the Annapolis Denny's, said the group welcomes the NAACP-Flagstar agreement.

But, Mr. Watkins said, "as long as there are lawsuits outstanding against Denny's, we reserve the right to picket them any place in America."

Six uniformed black Secret Service officers have claimed in a lawsuit that they were denied service at the Annapolis Denny's because of their race while on a detail to protect President Clinton during an April 1 speech at the U.S. Naval Academy.

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