diff --git a/sdk_container/src/third_party/coreos-overlay/coreos-base/coreos-init/coreos-init-0.0.1-r102.ebuild b/sdk_container/src/third_party/coreos-overlay/coreos-base/coreos-init/coreos-init-0.0.1-r103.ebuild
similarity index 100%
rename from sdk_container/src/third_party/coreos-overlay/coreos-base/coreos-init/coreos-init-0.0.1-r102.ebuild
rename to sdk_container/src/third_party/coreos-overlay/coreos-base/coreos-init/coreos-init-0.0.1-r103.ebuild
diff --git a/sdk_container/src/third_party/coreos-overlay/coreos-base/coreos-init/coreos-init-9999.ebuild b/sdk_container/src/third_party/coreos-overlay/coreos-base/coreos-init/coreos-init-9999.ebuild
index 3a29714478..2a0c149631 100644
--- a/sdk_container/src/third_party/coreos-overlay/coreos-base/coreos-init/coreos-init-9999.ebuild
+++ b/sdk_container/src/third_party/coreos-overlay/coreos-base/coreos-init/coreos-init-9999.ebuild
@@ -10,7 +10,7 @@ CROS_WORKON_REPO="git://github.com"
 if [[ "${PV}" == 9999 ]]; then
 	KEYWORDS="~amd64 ~arm ~x86"
 else
-	CROS_WORKON_COMMIT="4f84a154d4eaf6d1e4d95087fb6ec091c8003333"
+	CROS_WORKON_COMMIT="da95154e87338e8d8b240b7cc1e541ba4c3821e9"
 	KEYWORDS="amd64 arm x86"
 fi
 
diff --git a/sdk_container/src/third_party/coreos-overlay/profiles/coreos/targets/generic/make.defaults b/sdk_container/src/third_party/coreos-overlay/profiles/coreos/targets/generic/make.defaults
index 739f760863..27f71ffb43 100644
--- a/sdk_container/src/third_party/coreos-overlay/profiles/coreos/targets/generic/make.defaults
+++ b/sdk_container/src/third_party/coreos-overlay/profiles/coreos/targets/generic/make.defaults
@@ -18,6 +18,7 @@ INSTALL_MASK="${INSTALL_MASK}
   /usr/share/gtk-doc
   /usr/share/i18n
   /usr/share/locale
+  /usr/share/zsh
   /var/db/Makefile
 "
 
diff --git a/sdk_container/src/third_party/coreos-overlay/sys-apps/systemd/systemd-217-r4.ebuild b/sdk_container/src/third_party/coreos-overlay/sys-apps/systemd/systemd-217-r5.ebuild
similarity index 98%
rename from sdk_container/src/third_party/coreos-overlay/sys-apps/systemd/systemd-217-r4.ebuild
rename to sdk_container/src/third_party/coreos-overlay/sys-apps/systemd/systemd-217-r5.ebuild
index b447c4797c..04e23a5e7c 100644
--- a/sdk_container/src/third_party/coreos-overlay/sys-apps/systemd/systemd-217-r4.ebuild
+++ b/sdk_container/src/third_party/coreos-overlay/sys-apps/systemd/systemd-217-r5.ebuild
@@ -411,6 +411,12 @@ multilib_src_install_all() {
 
 	# Disable the "First Boot Wizard" by default, it isn't very applicable to CoreOS
 	rm "${D}"/usr/lib/systemd/system/sysinit.target.wants/systemd-firstboot.service
+
+	# Do not ship distro-specific files (nsswitch.conf pam.d)
+	rm -rf "${D}"/usr/share/factory
+	sed -i "${D}"/usr/lib/tmpfiles.d/etc.conf \
+		-e '/^C \/etc\/nsswitch\.conf/d' \
+		-e '/^C \/etc\/pam\.d/d'
 }
 
 migrate_locale() {
diff --git a/sdk_container/src/third_party/coreos-overlay/sys-apps/systemd/systemd-9999.ebuild b/sdk_container/src/third_party/coreos-overlay/sys-apps/systemd/systemd-9999.ebuild
index 8a7f3928ab..69433a4cbb 100644
--- a/sdk_container/src/third_party/coreos-overlay/sys-apps/systemd/systemd-9999.ebuild
+++ b/sdk_container/src/third_party/coreos-overlay/sys-apps/systemd/systemd-9999.ebuild
@@ -402,6 +402,12 @@ multilib_src_install_all() {
 
 	# Disable the "First Boot Wizard" by default, it isn't very applicable to CoreOS
 	rm "${D}"/usr/lib/systemd/system/sysinit.target.wants/systemd-firstboot.service
+
+	# Do not ship distro-specific files (nsswitch.conf pam.d)
+	rm -rf "${D}"/usr/share/factory
+	sed -i "${D}"/usr/lib/tmpfiles.d/etc.conf \
+		-e '/^C \/etc\/nsswitch\.conf/d' \
+		-e '/^C \/etc\/pam\.d/d'
 }
 
 migrate_locale() {