IANAL and
TINLA, that goes without saying, though I'm every now and then the go-to guy for first level screening of FOSS licenses.
The modified GPL V2 of FreeRTOS seems to be quite benign, sort of a LGPLv2 with static linking.
Other form of linking are not mentioned in the GPL exception, but usually not very relevant for the embedded case.
The most severe binding is that if one modifies the FreeRTOS files themselves, those changes fall under the regular GPLv2: their source needs to be made available to your customers for a period of three years (no need to have it public, but the customer could freely decide to make it so!).
Do we have any better alternatives to freeRTOS which are free and open source only?
What do you mean by free and open source only?
All usable SW comes with one or more licenses, unless it is in the public domain.
(if a piece of SW has no license, it cannot be -lawfully- used by anyone but the copyright holder)
Open Source SW Licenses can be
very permissive or
very restrictive, but are a fact of life.
A product to check is
ChibiOS, its double licensing (GPLv3 and Free Commercial) could fit your needs.