Exclude needs to be in the $cat_args, and in the shortcode_atts. Like this:
extract( shortcode_atts( array(
‘exclude’ => ”,
‘categoriespostcount’ => ‘on’,
‘categorieshierarchy’ => ‘on’,
), $atts ) );
$cat_args = array(
'exclude' => $exclude,
'taxonomy' => 'theme_portfolio_categories',
'show_count' => $c,
'hierarchical' => $h,
'echo' => 0
);