diff --git a/shell/Makefile.am b/shell/Makefile.am
index bb874fba..99f55255 100644
--- a/shell/Makefile.am
+++ b/shell/Makefile.am
@@ -4,7 +4,6 @@ bin_SCRIPTS = sugar-shell
 
 sugardir = $(pkgdatadir)/shell
 sugar_PYTHON =				\
-	__init__.py			\
 	shellservice.py
 
 confdir = $(pkgdatadir)/shell
diff --git a/sugar-emulator b/sugar-emulator
index d4005d52..f7fc133c 100755
--- a/sugar-emulator
+++ b/sugar-emulator
@@ -25,8 +25,6 @@ pygtk.require('2.0')
 import gtk
 import gobject
 
-from sugar import env
-
 def _get_display_number():
     """Find a free display number trying to connect to 6000+ ports"""
     retries = 20
@@ -90,6 +88,8 @@ else:
 _gtk_xft_dpi = float(gtk.settings_get_default().get_property('gtk-xft-dpi'))
 _start_xephyr(width, height, _gtk_xft_dpi / 1024)
 
+from sugar import env
+
 os.environ['GTK2_RC_FILES'] = env.get_data_path('gtkrc')
 
 os.execlp('dbus-launch', 'dbus-launch', '--exit-with-session', program)